Ex-Arrow Trucking employees to be paid

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December 10, 2010

By D.R. Stewart For The Associated Press The Enid News and Eagle Fri Dec 10, 2010, 10:40 AM CST

TULSA — Christmas will be a lot merrier this year than it was last year for 564 former employees of bankrupt Arrow Trucking Co.

A federal bankruptcy judge has approved the distribution of $1.97 million in Arrow Trucking bankruptcy estate assets to the 564 former employees who filed wage and employment law violation claims against the estate.

Arrow bankruptcy trustee Patrick J. Malloy III sought the order to approve the interim distribution last month, and it was approved late Wednesday by Judge Dana L. Rasure of the U.S. Bankruptcy Court for the Northern District of Oklahoma in Tulsa.

“We are signing the checks (now),” Malloy said Thursday, and “we will mail out a bunch today. They should all be out of here Friday.”

For the former Arrow employees, it’s been a long wait for some measure of justice, Malloy said.

If, as expected, most former Arrow employees receive their checks by early next week, it will be nearly 51 weeks to the day — Dec. 22 — since Arrow shut down its operations.

On that day, company executives locked employees out of corporate offices and abandoned hundreds of drivers and their freight around the country without fuel or money to return home.

Arrow, a 61-year-old Tulsa flatbed carrier, filed a Chapter 7 bankruptcy liquidation petition in U.S. Bankruptcy Court in Tulsa on Jan. 8.

Malloy estimates Arrow’s assets at $8.55 million and liabilities at $98.97 million.

The employee claims against the bankruptcy estate include back wages and claims arising from Arrow’s violation of the federal WARN Act.

The Worker Adjustment and Retraining Notification Act requires companies employing more than 100 people to give each employee at least 60 days’ written notice of a plant closing and the termination of their employment.

Failure to provide the notice can make employers liable for 60 days of wages per employee, the law says.

Malloy is distributing $1,972,806 — 58.7 percent of the $3,359,304 in priority wage and WARN Act claims filed against the estate. Former employees receiving checks will get about two-thirds of their wage and WARN Act claims, Malloy said.

The trustee is holding back about $1.5 million in bankruptcy estate assets to cover future claims that could be filed in the case, he said.

“There will be more (distributions to former employees),” Malloy said. “This won’t be the only one. We still have claims (against Arrow insiders and other entities) we’re pursuing that I feel very good about.”

Of the employees to whom checks are being distributed, more than 60 are entitled to the maximum $10,950 allowed in priority wage claims for unpaid wages plus WARN Act damages, Malloy has found.

The 60-plus former employees will receive $6,431.68 — two-thirds of their claims — in the initial distribution, court documents show. The smallest proposed interim distribution to an employee is $293.68.

Malloy said it took the efforts of more than 20 people in his office, two accounting firms and an auction service to reconstruct Arrow’s financial records and locate assets that could be used to compensate former employees.

“I’m very pleased that in less than one year, we have been able to recover enough money to make a distribution in the same month that Arrow ceased operations,” he said.

———

Information from: Tulsa World, http://www.tulsaworld.com

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