UnitedHealth Group and Optum have settled a lawsuit filed by two former employees who had alleged that the company violated state and federal employee notification laws during mass layoffs in August 2023.
The lawsuit, filed in the District Court for the Northern District of California, accused UnitedHealth of failing to provide the required 60 days notice or pay in lieu of notice under the WARN Act. The plaintiffs claimed that more than 1,000 employees, including 700 in California, were laid off without proper notification. The lawsuit further alleged that the company had directed terminated employees to sign severance agreements that provided less compensation than the WARN Act mandates, effectively waiving their rights to the full 60 days of pay.
The plaintiffs had sought damages, including unpaid wages and benefits, as well as a declaration that the releases they were asked to sign were invalid. After a review of the claims’ viability, the plaintiffs agreed to settle, according to court documents filed June 12. The plaintiffs’ legal counsel wrote that it became clear that proving the WARN Act violations would be difficult, particularly because the layoffs may not have met the threshold reporting requirements under the law. The plaintiffs themselves did not meet the criteria necessary to assert the claims based on their length of employment.
The former employees agreed to drop their claims as part of a settlement agreement, which included acknowledgement that they would not receive any further payments from UnitedHealth.
At the time of the lawsuit’s original filing, former employees with Optum and its subsidiaries had taken to social media regarding an unknown number of layoffs they said occurred across the company.
