A day after management at New Century Transportation Inc. of Westampton, N.J., dropped a bombshell on nearly 1,500 employees, including 1,000 drivers, that the company was suddenly closing its doors, a skeleton crew is still working behind the scenes on Wednesday, June 11, to calm customers’ and drivers’ nerves. Many drivers are on their way to return their equipment.
A customer service representative for New Century said the company is working with other companies, including Estes Freight, to get their freight delivered. She said several trucking companies were on-site at the company’s headquarters on Wednesday, interviewing truck drivers for potential jobs as they returned to the lot with their trucks. Estes has stated they have some driver openings available, but is not buying New Century.
“The phones have been ringing off the hook, and there are just a few of us still here,” the representative, who did not want to be named, told Land Line.
Matt Huber, former outbound dispatcher for New Century, told Land Line on Wednesday that while he is not in the office, he is still in contact with his former co-workers.
“We were a tight-knit group; there was a lot of camaraderie as we said our goodbyes yesterday,” Huber said.
He said that a group of about five drivers who live in the Columbus, Ohio, area pooled their money together and rented a van to share a ride home. As of yesterday, the company was providing drivers with rides to the nearest bus station.
“The word is still that no one is being stranded on the road,” Huber said on Wednesday. “However, once they get to the terminal in New Jersey, it is on them to get themselves home.”
Many drivers recall the Arrow Trucking shutdown in December 2009, which stranded truckers all across the county with no fuel and no money. Some were unable to return their trucks to the company’s headquarters. While Huber says he has been told that the drivers will be paid, some are unsure if they will have the financial means to get back home. It all depends on whether they receive their paychecks as promised.
As of press time on Wednesday, a representative for the Greyhound Bus Terminal in Mount Laurel, N.J., which is located about six miles from New Century’s headquarters, told Land Line that no truck drivers for New Century had been stranded at the terminal without financial means to get home.
“It’s been quiet today; no one is waiting,” the Greyhound representative said.
First lawsuit filed same day as mass termination
The day the termination notice was sent to all New Century personnel, one truck driver filed a class action complaint claiming the company violated the Worker Adjustment and Retraining Notification – or WARN Act – as well as the New Jersey Millville Dallas Airmotive Plant Job Loss Notification Act.
According to court documents filed on June 9, the named plaintiff, Robert Kearney, who worked for New Century and previously for Jevic Transportation before it closed, “seeks to recover the greater of 60 days wages and benefits pursuant to the WARN Act, or lost wages, benefits and other remuneration, including severance pay equal to one week of pay for each full year of employment, under the New Jersey WARN Act.
It’s still unknown whether New Century drivers and employees will be paid what they are owed on Friday, June 13. In the class action complaint, Kearney and others are seeking to receive their wages, commissions, bonuses, accrued holiday pay and accrued vacation. They are also seeking pension and 401(k) contributions and other COBRA benefits for 60 days “that would have been covered and paid under the then-applicable employee benefit plans had that coverage continued for that period.”
On Wednesday, Land Line spoke with Jack Raisner of Outten & Golden LLP, which is the law firm representing Kearney in the class action complaint against New Century. Raisner is encouraging all employees to go to their website and input their information to be included in the proposed class action complaint.
The same law firm also filed a WARN Act suit against Jevic Transportation Inc., which abruptly shut down in May 2008, terminating approximately 1,800 employees. Raisner said the Jevic lawsuit has been certified as a class action. Many dispatchers, drivers and employees left Jevic and then went to work for New Century.
Matt Huber was one of those dispatchers who now has been through two massive shutdowns –the first with Jevic – in a six-year period. While saddened to lose his job and daily contact with his fellow employees and drivers, he is hopeful that his luck is going to turn around for the better.
“What can you say? It’s no fun to be put in this position twice, but I have a feeling that everything’s going to work out all right,” he said.
Jack Raisner said New Century was required by federal and state law to provide its employees with a 60-day notice prior to the shutdown. Instead, employees received their WARN Act letters on the same day their employment was terminated.
According to the New Jersey Department of Labor and Workforce and Development’s website, New Century filed its WARN notice with the state on the same day it closed its doors. The state website also contains important information for former employees and drivers on how to apply for unemployment insurance benefits in New Jersey.
“It’s been my experience that most companies that find themselves in this position hire a chief restructuring officer – or CRO – to help with the company’s financial matters prior to a bankruptcy filing,” Raisner said. “It appears this hasn’t been done yet, which typically leads to chaos because the employees, the drivers and the creditors don’t know what the company’s plans are and it becomes a free fall.”
He said the federal WARN Act and the New Jersey WARN Act may provide former employees and drivers with some protection, which the courts will still have decide. The questions that must be answered include whether the company knew in advance of the shutdown (which may make them liable under the federal and state WARN Acts) or was the depletion of operating capital truly unexpected.
A week prior to the company’s closure, rumors were swirling in the trucking industry that New Century was teetering on the brink of closing its doors. Late Monday, June 9, employees and drivers received word that the company was filing for Chapter 7 bankruptcy protection and shutting its doors. As of press time on Wednesday, the bankruptcy petition still had not been filed with the court.
Employees received this letter from Terrence M. Gilbert, chief executive officer of New Century, late Monday.
“This is to notify you that, due to unforeseeable and dramatic change in business circumstances beyond its control, New Century Transportation Inc. expects that it will permanently shut down its operations and all of its facilities, including the facility located at 45 East Park Drive, Westampton, N.J., and will terminate all employees.”
According to Gilbert’s letter, the shutdown arose “when NCT’s lender recently and unexpectedly declined to continue funding regular business operations.”
Gilbert had not returned Land Line’s calls as of press time on Wednesday.
Some drivers told Land Line they had a bad feeling something was wrong when their fuel cards didn’t work late last week, but again were working on Monday. Huber told Land Line that he heard that the company received a cash infusion to pay Comdata to get the fuel cards working to get the equipment home.”
“From what I have heard, it’s not the intention for the drivers to be stranded on the road,” Huber said. “I have heard that the drivers will be paid for every mile they run if they return their equipment back here to New Jersey. Again, that’s just what I have heard.”
Huber repeated that this isn’t his first go-around with a shutdown of this magnitude.
“Last week I had an eerie feeling that this was what was going to happen,” Huber said. “While we were getting reassurances that this wasn’t the case, things were so similar to when Jevic closed its doors.”
Dale Watkins of the Owner-Operator Independent Drivers Association said that it’s important for drivers who are in the process of returning their equipment to document it, either by taking a photo at the home terminal or by having someone with the company sign a document, confirming that their equipment has been returned.
Watkins said drivers that do not have the financial means to get back home should contact the company and explain the situation. He said it’s important to document any communication with the company in case there is a dispute down the road.
On Wednesday, the customer service representative said drivers have been returning their trucks at a steady pace all day.
“Everyone has been kind of panicked around here,” she said. “Of course, we had heard rumors, but I think we are all still in shock.”