Aegis terminated employees sue for 60 days' pay and benefits

By Caroline Salls

Pittsburgh, Aug. 20 - Aegis Mortgage Corp.'s former employees have filed a class action lawsuit seeking 60 days' pay and related benefits, according to a Monday filing with the U.S. Bankruptcy Court for the District of Delaware.

The defendants named in the lawsuit include Aegis Mortgage, Aegis Wholesale Corp. and Cerberus Capital Management LP, but the class action plaintiffs said they were all on the Aegis Mortgage payroll, and the three defendants will be treated as a single employer in the lawsuit.

According to the filing, Aegis allegedly violated the Worker Adjustment and Retraining Notification Act because it did not give the employees at least 60 days' advance notice of their termination.

As a result, the former employees said they are entitled to 60 days' pay and related benefits, including bonuses, accrued holiday pay, accrued vacation, health insurance coverage and 401(k) contributions.

The former employees said their pay and benefit claims should receive administrative expense priority in Aegis' Chapter 11 case.

The plaintiffs said they were part of an Aug. 7 mass layoff, and they did not receive the 60 days' written notice that is required under the WARN Act for employees terminated in a mass layoff or plant closure.

The lawsuit class includes about 400 former Aegis employees.

Aegis Mortgage, a Houston-based mortgage production franchise, filed for bankruptcy on Aug. 13. Its Chapter 11 case number is 07-11119.

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