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Telltale Games has become a recognized force in the video game industry with such popular titles as The Walking Dead and The Wolf Among Us. However, the developer announced mass layoffs last week with the intention of closing the studio in the near future. A recently filed suit alleges that the layoffs violated the WARN law, which requires companies to inform their employees before collective dismissals.
According to former Telltale employees, an all-out meeting scheduled last Friday resulted in hundreds of immediate layoffs. As employees returned to their desks, the accounts of their G Suite employees were deactivated and they only had 30 minutes to leave the building. Unlike many tech companies, Telltale has offered no severance pay to employees and medical benefits should expire at the end of the month.
So, this whole situation has undoubtedly left a bitter taste in a lot of mouth. According to the Workers Adjustment Act and the WARN, Telltale could have broken the law by doing so. The 1988 law states that a company of 100 or more employees must give 60 days' written notice prior to a collective dismissal. The law defines collective redundancies as the dismissal of 50 or more employees over a period of 30 days, provided that this represents at least one-third of the workforce. California has an even stricter version of the WARN law that lowers the number of workers to 75 and includes part-time workers in the sum.
The last season of The Walking Dead will also be Telltale's last match.
The complaint was lodged by Vernie Roberts, a former employee of Telltale, on his own behalf and on behalf of the other dismissed workers. In the lawsuit, Roberts says Telltale fired about 275 people, including the 25 who stayed temporarily to complete the last chapter of the Telltale Walking Dead series.
The WARN law seeks to recognize that large companies do not usually decide to fire dozens of employees one day. Someone in the company knows that these layoffs are coming in, so it's fair to let the employees know in advance. Federal law provides for derogations for "business circumstances that were not reasonably foreseeable," which is probably the argument Telltale will invoke, indicating the loss of external financing. However, the California Warning Act does not have this clause.
If Telltale loses the lawsuit, what remains of the company might be forced to pay back the employees from the 60 days notice they did not receive.
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