Business

What to know about severance pay amid high-profile layoffs

Anchalee Phanmaha/Getty Images

(NEW YORK) -- Continued recession fears and a cascade of tech industry layoffs have drawn renewed attention to severance packages, the compensation offered to some departing employees.

Severance packages, which range widely in size and duration, offer newly unemployed workers a financial buffer as they face an uncertain job market.

But laid-off workers may not fully understand the terms of a severance package, or could feel pressure to accept the terms without looking them over closely, legal and career experts told ABC News.

As employees depart a company, they should be fully informed of the details of a separation and negotiate for the best outcome they can get, the experts added.

"If employers give money, there's a carrot in front of employees," Matt Blit, an attorney at employment law firm Levine and Blit, which handles severance cases, told ABC News. "Employees typically sign without even reading them."

Here's what you need to know about severance packages:

Why do companies offer severance?

Companies are not required by law to offer severance.

They provide ex-employees with financial and other benefits to blunt the damage caused by a termination that may be unrelated to a worker's performance, experts told ABC News.

The move also helps companies minimize the public relations backlash that can result from layoffs, they said.

"It sends a message about how you take care of your people," Alexandra Levitt, a career expert and author of the forthcoming book "Deep Talent," told ABC News. "Severance is a very important part of that."

In exchange, workers who accept severance agreements are often required to forgo publicly criticizing the company or bringing legal action against it, the experts said. In some instances, the agreements also stipulate that ex-employees cannot work at rival companies or seek business from the same clients, they added.

"Companies pay severance so that they never have to worry about an employee ever again," Blit said. "Companies are not in the business of giving away money."

What's in a typical severance package?

Experts on severance cautioned there is no common template used for the agreements, leaving the onus on departing employees to ensure they understand a package before accepting it.

"There's no such thing as a standard severance agreement," Blit said.

Still, severance packages usually include some or all of a common set of offerings: financial payment, continued access to health care and other benefits, job-search assistance and mental health support.

A company may offer some benefits in lieu of others, the experts said. The wide variation between severance agreements highlights the importance of reading the terms or asking a lawyer to examine them.

"There are so many different angles that employers take," Blit said.

How severance pay is calculated

The calculation behind the financial compensation offered in severance agreements varies from stingy to generous.

Favorable severance agreements offer one month's worth of salary for every year of tenure with the company; while more frugal packages provide just one week's worth of salary for each year, experts said.

If a laid-off employee worked for a company for five years, for instance, his or her compensation at the upper end of the range would amount to nearly a half year's worth of pay.

In some cases, companies offer a base amount of compensation and an additional sum tied to one's tenure. Google, which laid off 12,000 workers earlier this month, provided each employee with 16 weeks of severance pay, plus an additional two weeks for each year of tenure.

A federal law, called the WARN Act, mandates that large businesses give 60-day notice when undertaking a mass layoff. Some states, like Illinois and California, impose stronger versions of the nationwide law.

When layoffs must comply with such laws, companies either tell employees about the layoffs before they go into effect or keep workers on the payroll for two months afterward. If laid-off workers remain on the payroll, that compensation can be received separately from the pay offered in a severance package.

If a worker is set to receive a bonus, some employers pay a portion of that payout in the severance package, Blit said. Conversely, some employers demand repayment of a worker's signing bonus if he or she is terminated before reaching a given tenure threshold, he said.

"If an employee signs on to get a $5,000 bonus and gets terminated within the first year, he may have to give that money back," Blit said. "You can owe the employer money back."

When do companies pay severance?

Companies typically pay severance in a single lump sum or over a series of payments that mimic how an employee received his or her salary, experts said.

Under some severance agreements, ex-employees must stop receiving financial compensation if they find a new job, giving reason for some employees to opt for a lump payment.

But the size and timeline of a severance payment carries different tax implications, which can significantly affect the take-home pay enjoyed by a departing worker, experts said.

How is severance taxed?

Severance is taxed in the same manner as wage or salary income.

If payment is received in a large sum, therefore, the recipient faces the higher taxes associated with the elevated tax bracket in which that payment falls.

"You have to be careful looking at a huge sum, keeping in mind that it's going to be taxed at the same rate as income," Levitt said. "It's not a windfall -- it's taxed like any other income."

Ex-employees who take the income as a continuation of their salary payment will end up paying less in taxes, Blit said.

By comparison, the tax payment required for a lump sum is "astronomical," he said.

Can employees negotiate severance?

Severance experts encouraged departing employees to negotiate over their severance agreement since they have little to lose and potentially much to gain.

Laid-off workers can push for more compensation or a longer payment timeline, or they can try to exchange non-monetary benefits for monetary ones, Levitt said, adding that newly terminated employees should be sure to remain on good terms with their former employer.

"You don't have to be rude about it, but you can see if there's room for negotiation and just do your best," she said.

When asked whether laid-off workers should negotiate over the terms, Blit said, "Always."

When employers offer outplacement services, or job-search assistance, laid-off workers should try to exchange that benefit for its equivalent monetary value, he added.

"A lot of employers do provide some outplacement services – I find what employers typically provide to be kind of worthless," he said. "I usually tell clients to get the money value of it."

The negotiation over severance should resemble the initial push and pull over a newly hired worker's salary and benefits, Levitt said.

"There's negotiation at the start of engagement with an employer and negotiation at the end," Levitt said.

Copyright © 2023, ABC Audio. All rights reserved.


What to know about PFAS after Thinx underwear settles class-action lawsuit

Nicky J Sims/Getty Images, FILE

(NEW YORK) -- Human-made chemicals known as PFAS are back in the spotlight after the feminine hygiene company Thinx settled a class-action lawsuit earlier this month for millions of dollars.

The lawsuit was brought against Thinx by customers who claimed testing showed the brand's period underwear -- advertised by the company as sustainable, organic and reusable -- contained PFAS, otherwise known as per- and polyfluoroalkyl substances, or forever chemicals.

PFAS are manufactured chemicals that have been used in products like nonstick cookware, cosmetics and water-repellent clothing for decades, but have more recently been discovered to cause adverse health effects in some instances, according to the Centers for Disease Control and Prevention.

In the United States, manufacturers aren't required to identify PFAS on labels.

Thinx settled with the five plaintiffs late last year for up to $5 million, but a recently-launched website has reignited interest in the case and restarted the conversation on what consumers need to know about PFAS.

The website, Thinxunderwearsettlement.com, shares details on who is eligible to file a claim to be able to receive part of the settlement money.

Here is what to know about the Thinx settlement and the allegations over PFAS.

What led to the lawsuit against Thinx?

An article published in 2020 by Sierra magazine first brought attention to the ingredients in Thinx products.

The article's author, Jessian Choy, had Thinx menstrual underwear and a similar product from another brand tested by Dr. Graham Peaslee, a physics professor at the University of Notre Dame, whose research focuses on PFAS.

Peaslee found the presence of PFAS in the Thinx products at "high levels," "especially on the inside layers of the crotch," according to Choy's article.

Following the article's publication, several lawsuits were filed against Thinx, and eventually those cases were merged into the one class-action lawsuit against the company that was settled last year.

"The presence of these chemicals contradicts all of Thinx's unvarying representations that the product is nontoxic, harmless, sustainable, organic, environmentally friendly, and otherwise safe for women and the environment," the plaintiffs alleged in the lawsuit, also claiming the company "knowingly and willfully concealed and misrepresented the true nature of Thinx Underwear."

Erin J. Ruben, an attorney for the plaintiffs, told ABC News that the lawsuit focused on how Thinx marketed its products. She said the settlement in the case is "about more than just refunds."

"Thinx has agreed to make changes to its marketing, in addition to taking other measures to ensure that PFAS is not intentionally added to the product, which we believe will have lasting impact on consumers," Ruben said in a statement. "I also think it’s important that consumers understand that this case was about how Thinx's products were marketed -- not whether they caused harm to consumers."

What is Thinx's response to the lawsuit?

The lawsuit settlement includes no admission of wrongdoing by Thinx Inc., which includes the brands Thinx, Thinx Teens and Speax.

The company denies the allegations in the lawsuit, and denies it did "anything improper or unlawful," according to the settlement.

"Consumer health and product safety are top priorities for Thinx, and we stand by the quality, efficacy and safety of our products," a company spokesperson told ABC News in a statement. "The lawsuit is related to how products were marketed and not on product safety or any adverse health effects. PFAS has never been part of the brand’s product design and we continue to take measures to help ensure these substances are not added to our products."

The statement continued, "While the settlement included no admission of wrongdoing by Thinx, we have chosen to resolve this matter so that we can focus our attention on doing what the brand does best -- bringing innovative, safe and comfortable leak protection underwear to our consumers."

How common are PFAS in products?

PFAS began to be used in manufacturing in the 1950s, and for decades showed up in products ranging from shampoo and dental floss to cosmetics, fast food wrappers, pizza boxes, water-resistant clothing, umbrellas and in cleaning products like stain removers, according to the CDC.

It has only been in the last 20 years that further research has shown the dangers of PFAS, according to Peaslee, the Notre Dame professor who tested the Thinx products.

Because of their ability to last forever and because of their past widespread use, PFAS are still present all around, Peaslee explained.

"These things are so inert that they last for thousands of years, and they break down to the simplest products, which are all the fluorinated compounds," Peaslee told ABC News. "And these will actually get into your body and they start piling up, so everybody in North America already has millions of these chemicals in their blood."

In addition to absorbing the chemicals from products, people can also be exposed to PFAS through environmental factors like drinking water, accidentally ingesting soil or dust and eating exposed animal proteins, according to the CDC.

PFAS are not banned at the federal level in the U.S., but some states have taken action to restrict the use of PFAS.

How harmful are PFAS to a person's health?

Research shows that exposure to high levels of PFAS can lead to adverse health effects, but it is not yet known exactly what the level of exposure is that leads to different health outcomes, according to the Environmental Protection Agency.

So far, research has shown that "exposure to certain levels of PFAS" may lead to everything from developmental delays in children and increased risk of some cancers to increased risk of obesity and high cholesterol, according to the EPA.

In women, exposure to PFAS may lead to difficulty getting pregnant, hormone issues and increased high blood pressure when pregnant, according to the EPA.

Peaslee noted that wearing a period product that contains PFAS is not going to harm a person in the short-term, but it may contribute to a bigger issue.

He said the risk of PFAS exposure is higher in certain areas of the body, including the groin, neck and underarms.

"No, they're not going to die from their period underwear by wearing them today, but they will increase their risk of exposure to these chemicals," he said. "And these chemicals you don't really want in your body, and they're already there."

Peaslee continued, "For most people, especially those with children or of childbearing age, you'd like to not be exposed to an extra chemical, and this is one that we can avoid."

How can PFAS be avoided?

Since companies do not have to list the presence of PFAS on labels, Peaslee suggests keeping an eye out on products that have an extra label showing they are PFA-free.

"When you get a label that says 'no intentional PFAS added,' that company has done some diligence," he said. "They're putting an extra 5-cent label on it to say, you know, 'We checked.'"

Peaslee said consumers can also watch for products marketed with words like "water-resistant" and "long-lasting," as those are two qualities that PFAS are used to help produce.

"You can look at those as indicators that you might have a problem," he said. "But you don't know for sure until somebody does a test or until a product deems itself and has been tested to be PFA-free, and that means the company has done some tests."

The EPA says to be aware of the water and food you consume and ensure they do not come from contaminated sources.

While individuals do not need to be tested for PFAS exposure, the U.S. Preventive Services Task Force recommends undergoing regular routine health screenings and following a physician’s guidance.

What do I do if I own Thinx underwear?

The settlement applies to people who purchased certain types of Thinx underwear in the U.S. between Nov. 12, 2016, and Nov. 28, 2022, according to the settlement website.

People who submit a claim have options ranging from receiving a cash refund up to $21 to a voucher for 35% off future purchases.

People also have the option to exclude themselves from the settlement, which would then make them free to file their own lawsuit should they desire.

ABC News' Kelly McCarthy and Jacqueline Laurean Yates contributed to this report.

Copyright © 2023, ABC Audio. All rights reserved.


Tech layoffs 2023: Companies that have made cuts

Mateusz Slodkowski/SOPA Images/LightRocket via Getty Images

(NEW YORK) -- Companies across the tech industry have announced layoffs, affecting thousands of workers in the first few weeks of 2023.

Sales at top tech firms have retreated from the blistering pace attained during the pandemic, when billions across the world were forced into isolation. Customers stuck at home came to rely on delivery services like e-commerce and virtual connections formed through social media and videoconferencing.

Company officials have often cited economic uncertainty and fears of a recession in their job-cutting, cost-cutting decisions. It follows a volatile 2022, which was also marred with layoffs by the thousands across major tech brands.

SAP

SAP, the biggest software company in Europe, will lay off 2.5% of its global workforce, which amounts to about 2,800 employees, an earnings report on Thursday showed.

The move, which the company described as a "targeted restructuring," will cost between 250 million and 300 million euros, the earnings report said.

The layoffs will deliver yearly cost savings in 2024, the company said.

IBM

IBM will lay off 1.5% of its workforce or about 3,900 employees, the company announced on Wednesday.

The move is tied to the previously disclosed spinoff of Kyndryl, an IT-management company, as well as the sale of two business units, a spokesperson told ABC News.

The layoffs will cost the company $300 million over the first three months of 2023, the spokesperson said.

Spotify

Spotify, the Sweden-based music streaming platform, announced on Monday plans to slash 6% of its workforce, which amounts to about 600 employees.

After strong pandemic-era performance, the company encountered a challenging business environment, CEO Daniel Ek told employees in a memo on Monday.

"Like many other leaders, I hoped to sustain the strong tailwinds from the pandemic and believed that our broad global business and lower risk to the impact of a slowdown in ads would insulate us," he said. "In hindsight, I was too ambitious in investing ahead of our revenue growth."

Wayfair

Online home goods retailer Wayfair will lay off about 1,750 workers or roughly 10% of its staff, the company announced Friday, Jan. 20.

Wayfair saw business surge during the pandemic, as people stuck at home eschewed brick-and-mortar shopping and increased spending on furniture, home renovations and other domestic improvements.

But the economic environment has turned against the company, as inflation has strained household budgets and limited nonessential purchases.

The move last week follows a previous round of layoffs in August that cut 5% of the company's workforce.

"We thrive when we are scrappy and dedicated to customer outcomes," Wayfair CEO and Co-founder Niraj Shah said Friday in a message to employees. "Unfortunately, along the way, we over complicated things, lost sight of some of our fundamentals and simply grew too big."

Google

Alphabet Inc., the parent company of Google, said it will cut roughly 12,000 jobs from its global workforce on Friday, Jan. 20.

The decision will impact approximately 6% of the company's employees.

"This will mean saying goodbye to some incredibly talented people we worked hard to hire and have loved working with," said Google's CEO Sundar Pichai in an email to Google employees on Friday morning.

"I'm deeply sorry for that. The fact that these changes will impact the lives of Googlers weighs heavily on me, and I take full responsibility for the decisions that led us here."

Pichai told employees the company is "bound to go through difficult economic cycles" and will "reengineer our cost base, and direct our talent and capital to our highest priorities."

Microsoft

Microsoft said on Jan. 18 it will lay off 10,000 employees this year, affecting nearly 5% of Microsoft's global workforce.

The layoffs at Microsoft arrive in response to "macroeconomic conditions and changing customer priorities," the company said in a filing with the Securities and Exchange Commission.

"As we saw customers accelerate their digital spend during the pandemic, we're now seeing them optimize their digital spend to do more with less," Microsoft CEO Satya Nadella said in a memo to employees on Wednesday.

He continued, "We're also seeing organizations in every industry and geography exercise caution as some parts of the world are in a recession and other parts are anticipating one."

Amazon

In early January, Amazon announced plans to eliminate just over 18,000 roles total, including impending layoffs announced in November. The majority of roles being cut are in Amazon Stores and People Experience and Technology Solutions teams, according to an email sent to employees from Amazon CEO Andy Jassy.

Jassy had warned in November that job cuts at the e-commerce giant would continue in early 2023. Amazon employs roughly 1.5 million employees around the globe.

"This year's review has been more difficult given the uncertain economy and that we've hired rapidly over the last several years," the message read.

It continued, "We typically wait to communicate about these outcomes until we can speak with the people who are directly impacted. However, because one of our teammates leaked this information externally, we decided it was better to share this news earlier so you can hear the details directly from me."

Coinbase

Coinbase, a cryptocurrency trading platform, announced it will lay off 950 people, in a Jan. 10 statement from CEO Brian Armstrong.

"As we examined our 2023 scenarios, it became clear that we would need to reduce expenses to increase our chances of doing well in every scenario," Armstrong said in the statement.

"While it is always painful to part ways with our fellow colleagues, there was no way to reduce our expenses significantly enough, without considering changes to headcount."

Vox Media

Vox Media is also laying off employees, according to the Vox Media Union.

In a statement on Twitter, the union said, "We were informed today that the company is laying off around 7 percent of its workforce, and some of our members have been impacted. We're furious at the way the company has approached these layoffs, and are currently discussing how to best serve those who just lost their jobs."

Layoffs affecting other industries

Newell Brands -- the parent company of a host of consumer brands like outdoor goods company Coleman and cookware company Crockpot -- announced on Monday, Jan. 23, plans to lay off 13% of its office staff.

The move came in response to "the reality of the economic environment," CEO Ravi Saligram said in a message to employees.

"There’s no sugar coating this news," he added. "We will have to part with colleagues who we value and enjoy working with."

ABC News' Max Zahn and Jon Haworth contributed to this report.

Copyright © 2023, ABC Audio. All rights reserved.


The year crypto broke: How customers, investors lost millions and what's being done

Curt Dell said he lost more than $200,000 worth of Bitcoin after Celsius filed for bankruptcy. - ABC News

(NEW YORK) -- It seemed like cryptocurrency was having a moment.

At the start of 2022, the Super Bowl featured celebrities like Tom Brady, Larry David and Matt Damon in commercials for crypto companies. Logos for crypto companies like FTX could be seen plastered on multiple sports arenas and a new wave of crypto influencers emerged, garnering hundreds of thousands of followers. Cryptocurrency was everywhere.

It was supposed to be an alternative to traditional finance.

Instead of exchanging money through a third party, like a bank, cryptocurrency allows users to transfer digital currency directly. However, unlike traditional forms of currency such as the U.S. dollar, the government does not insure deposits and federal agencies have taken limited steps to regulate the crypto industry.

But the major crash of the crypto market last year has brought headaches, fear and anger among the millions of people around the world who invested their savings and are left wondering whether they'll ever see their money again.

Curt Dell, a father of three from California, told ABC News' Rebecca Jarvis that he's lost over $200,000 in Bitcoin after the digital crypto lending company Celsius went bankrupt last year.

"It robbed [my family] of so much potential," said Dell, a California resident who works in sales. "It's such a bad situation."

"Impact x Nightline" takes a closer look at the chaos throughout the industry, speaking with executives at some of the biggest crypto companies, top officials at regulatory agencies, and the regular customers who suffered from the collapse. This episode is streaming now on Hulu.

"Crypto kind of rose out of the 2008 financial crisis," David Yaffe-Bellany, a New York Times reporter who covers crypto, told "Impact."

"That whole catastrophe was an example of the failures of the centralized financial system, and it helped inspire this movement to create a parallel financial system that didn't rely on the types of institutions whose bad behavior had caused a lot of people to suffer."

The crash shook the entire industry -- and multiple companies, including Celsius Network, filed for bankruptcy.

"What the crash did was prompt a kind of run on the bank. People panicked," Yaffe-Bellany said. "They thought that their cryptocurrencies were in danger, and they moved to withdraw everything that they deposited in Celsius, and that's what kind of exposed the kind of shaky foundations of the whole company."

Celsius was founded by Alex Mashinsky and two partners in 2017. Mashinsky used social media to promote his company and its high-yield crypto earnings.

"The whole idea of Celsius network was that it was a kind of crypto bank, except better than a bank," Yaffe-Bellany said. “You'd deposit your crypto. It would be safe there, but you'd also get these enormous returns on top of that.”

At its peak, Celsius had 2 million customers and a $3 million valuation. The company filed for bankruptcy in July.

In early January, New York Attorney General Letitia James sued Mashinsky, accusing him of defrauding investors. He didn't respond to multiple requests by ABC News for an interview or comment.

It’s too early to know how the Celsius bankruptcy process will play out, and whether customers will get back any of their money.

"I'd like to stay optimistic and think that I'll get at least a significant portion of it back," Dell said of his investment. "I don't think anybody really knows."

Celsius' bankruptcy has also been intertwined with the biggest scandal rocking the crypto industry: the fall of one of the largest cryptocurrency exchanges, FTX.

Sam Bankman-Fried, the founder and CEO of FTX, posted on social media suggesting he might bid to take over Celsius’ assets shortly after the company filed for bankruptcy.

But that was before FTX found itself in trouble as well.

In early November, FTX filed for bankruptcy after a series of events exposed a multi-billion-dollar hole in the company’s balance sheet. A little over a month later Bankman-Fried was charged in federal court with eight counts of fraud. He has pleaded not guilty and his trial is slated to begin in October.

The series of high-profile collapses in the crypto industry has prompted calls for more regulation from the federal government.

The high-profile crypto collapses have prompted calls from activists, elected officials and others for more regulation from the federal government.

Christy Goldsmith Romero, a commissioner at the Commodity Futures Trading Commission, told "Impact" that she agrees that the industry does need more oversight.

"We need, as regulators, the ability to go in to inspect, to go in and have exams, to set rules. And we need to ensure that there's no commingling of assets," she said.

Gary Gensler, the chair of the U.S. Securities and Exchange Commission, told "Impact" he is willing to work more with the CFTC to protect consumers from shady crypto investments. In the meantime, he warned consumers to think hard before they invest their money in crypto.

"Don't get caught up in the FOMO, but you're also at risk of a field that the business model is taking your assets [and] co-mingling them, often in ways that are not allowed by our current laws," he said.

Copyright © 2023, ABC Audio. All rights reserved.


US economy grew at end of 2022, defying recession fears

Javier Ghersi/Getty Images

(WASHINGTON) -- The U.S. economy grew robustly at the end of last year, defying recession fears and weathering an aggressive series of interest rate hikes from the Federal Reserve, government data showed.

U.S. gross domestic product grew by a 2.9% annualized rate over the three months ending in December, according to data released Thursday. It marked a slowdown from 3.2% growth in the previous quarter.

The economy expanded despite interest rate hikes imposed last year by the Federal Reserve that aim to slow price increases by cooling the economy and choking off demand.

The approach, however, risks tipping the U.S. into a recession and putting millions out of work.

The gross domestic product data arrives days before the Federal Reserve decides whether to impose another interest rate hike, its first opportunity to do so this year. Last month, the Fed raised its short-term borrowing rate 0.5%, slowing the pace from previous rate hikes.

Economic activity shrank a combined 2.2% over the first six months of last year, marking two consecutive quarters of negative GDP, which many consider shorthand for identifying a downturn as a recession.

The National Bureau of Economic Research, a research organization seen as the formal authority for identifying recessions, uses a more complicated definition that takes into account an array of factors. It did not declare a recession last year.

The labor market has proven resilient. Hiring remained strong last month as employers added 233,000 jobs and wages grew a robust 4.6% compared to a year earlier.

Meanwhile, inflation has softened. Consumer prices rose 6.5% last month compared to a year ago, extending a months-long slowdown of price hikes after reaching a 40-year high in June.

Still, most economists expect a recession later this year, as interest rate hikes weigh on the economy, according to a survey released by Bloomberg last week. Forecasters expect gross domestic product to fall over the second and third quarters of this year, the survey found.

Despite the robust job market, growing evidence suggests the Fed's rate hikes have put the brakes on some economic activity.

Home sales fell for the 11th consecutive month in November, reaching their lowest rate since November 2010, according to the National Association of Realtors.

Copyright © 2023, ABC Audio. All rights reserved.


Barbie pays tribute to Bessie Coleman with new Inspiring Women series doll

Mattel

(NEW YORK) -- Barbie is honoring the life and legacy of Bessie Coleman with a new doll.

Coleman, whose birthday falls on Jan. 26, was the first Black and Native American female aviator and the first Black person to ever earn an international pilot's license.

The late American pioneer is being honored as part of the toymaker's Inspiring Women line of dolls for inspiring generations of women and people of color to explore a career in aviation.

Barbie teamed up with Coleman's great niece Gigi Coleman, the president of The Bessie Coleman Aviation All-Stars, to ensure the aviator's legacy was represented in its truest form.

The doll wears a brown hat emblazoned with her historic initials -- "BC" -- an olive green belted aviator suit and lace-up boots, much like Coleman wore.

"As someone who has dedicated much of my life to encouraging youth of all backgrounds to explore careers in aviation, my family and I commend Barbie for expanding my great aunt's legacy in such an overwhelming tribute, with a Bessie Coleman Inspiring Women doll," Gigi Coleman said in a statement. "Keeping Bessie's legacy alive has always been a labor of love for my family, and we are proud to recognize her determination and accomplishments for Black women in aviation and continue to share my great aunt's pioneering spirit with fans of all ages."

She added, "We hope through this doll more people will discover Bessie's story and be inspired. Stories have power, I grew up on anecdotes of my great-aunt's courage and look forward to sharing them in my upcoming book."

Lisa McKnight, executive vice president and global head of Barbie & Dolls at Mattel, also spoke highly of the company's latest launch.

"Bessie is a remarkable icon to inspire children everywhere to soar to greater heights," she said in a statement.

The Bessie Coleman Inspiring Women Doll is now available to shop at several mass retailers.

Copyright © 2023, ABC Audio. All rights reserved.


New York attorney general voices concern over facial recognition

Michael M. Santiago/Getty Images

(NEW YORK) -- A viral controversy over the use of facial recognition technology to bar customers from New York City performance venues has drawn the attention of the state's top cop.

New York Attorney General Letitia James on Wednesday sent a letter to Madison Square Garden Entertainment -- the company that owns venues like Radio City Music Hall and Madison Square Garden - requesting information about the policy and raising the possibility that it could be illegal, James' office said.

The letter also questions whether the facial technology is reliable and what safeguards are in place to avoid bias and discrimination, her office added.

The weekend after Thanksgiving, lawyer Kelly Conlon tried to join her daughter's Girl Scout troop at a Rockettes performance but the venue scanned her face and barred her entrance.

Conlon reportedly appeared on an "attorney exclusion list" created by Radio City Music Hall's parent company, MSG Entertainment, which bans employees at law firms engaged in litigation with the company, even if a given individual isn't involved directly.

In this case, Conlon wasn't involved directly, but her firm was engaged in litigation against one of the company's restaurants, the New York Times reported. The incident at Radio City Music Hall was first reported by a New York affiliate of NBC.

In a separate incident at Madison Square Garden last month, another attorney was removed from a basketball game with the use of facial recognition software for the same reason as Conlon, the New York Post reported.

"MSG Entertainment cannot fight their legal battles in their own arenas," James said in a statement on Wednesday.

"Madison Square Garden and Radio City Music Hall are world-renowned venues and should treat all patrons who purchased tickets with fairness and respect," she added. "Anyone with a ticket to an event should not be concerned that they may be wrongfully denied entry based on their appearance, and we're urging MSG Entertainment to reverse this policy."

MSG Entertainment did not respond to a request for comment on the letter from James.

In a statement to ABC News earlier this month, a spokesperson for MSG Entertainment defended the company's use of facial recognition software.

"Facial recognition technology is a useful tool widely used throughout the country, including the sports and entertainment industry, retail locations, casinos and airports, to protect the safety of the people that visit and work at those locations," the spokesperson said.

"Our venues are worldwide destinations and several sit on major transit hubs in the heart of New York," the spokesperson added. "We have always made it clear to our guests and to the public that we use facial recognition as one of our tools to provide a safe and secure environment for our customers and ourselves."

Copyright © 2023, ABC Audio. All rights reserved.


How financial savings trend 'credit card fast' helped one woman buy a home

Lisa Samalonis

(NEW YORK) -- Credit card debt is often easy to pile on, but hard to pay off. For Lisa Samalonis, smart credit card saving was the key to rebuilding her life after divorce.

"It was very important for me to preserve some of that money so that I could put it down for a down payment and also to preserve through the divorce, to preserve my credit score so that I would be eligible for a mortgage," Samalonis told ABC News' Good Morning America.

The New Jersey mother said she had to adjust to living as a single mother of two on one income, so she decided to go on what she calls a "credit card fast."

"Not using my credit card in the beginning was a key factor in that, because when you're using cash or debit, you can see [that] you don't have enough money," she said. "It's having the awareness to know that you're actually spending more than you have."

With the help of her new trick, Samalonis was able to buy her own home. She shared her top three steps to becoming financially free.

Break down your finances

Samalonis said she bought a notebook to write down her expenses, prioritizing what was most important.

"The ones that were most important at the top, like food and my mortgage or housing. And then down the list of things that were less important," she said, adding that she was able to grant her own freedom by being honest with herself.

"By kind of breaking it down, and really being honest or getting real with myself, that actually gave me control as I went forward," she said.

Use zero-based budgeting

Samalonis said if you must use a credit card, be sure to continue to allocate your expenses so your budget remains accurate.

"When you use your credit card, you take money that you have in your account and you put it into a category or you allocate it to what you've just spent," she said.

Plan ahead

Finally, Samalonis said the best way to be prepared for the "credit card fast" is to plan ahead. Unexpected expenses will always come up, but you can plan a savings cushion to help cover some of those surprises.

"When unexpected expenses came up, either if it was things that were owed or if it was things that we wanted to do, I tried to plan ahead and so I would be able to save money each month towards that goal," Samalonis said.

Copyright © 2023, ABC Audio. All rights reserved.


Justice Department files antitrust lawsuit against Google over digital advertising

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(WASHINGTON) -- The Justice Department and eight other states filed a historic antitrust lawsuit Tuesday targeting Google over what they allege is the Big Tech giant's monopoly over the online advertising market.

The lawsuit, filed in the Eastern District of Virginia, aims to have Google's dominance in the online ad marketplace broken up by having a court compel the company to divest its Google Ad Manager suite. They also seek an order from the court enjoining Google from further engaging in any of the anticompetitive practices outlined in their lawsuit.

"Having inserted itself into all aspects of the digital advertising marketplace, Google has used anticompetitive, exclusionary, and unlawful means to eliminate or severely diminish any threat to its dominance over digital advertising technologies," according to the lawsuit. "The United States and Plaintiff States bring this action for violations of the Sherman Act to halt Google's anticompetitive scheme, unwind Google's monopolistic grip on the market, and restore competition to digital advertising."

DOJ is joined in the lawsuit by California, Colorado, Connecticut, New Jersey, New York, Rhode Island, Tennessee and Virginia.

"Competition in the ad tech space is broken, for reasons that were neither accidental nor inevitable," the DOJ wrote in the lawsuit. "One industry behemoth, Google, has corrupted legitimate competition in the ad tech industry by engaging in a systematic campaign to seize control of the wide swath of high-tech tools used by publishers, advertisers, and brokers, to facilitate digital advertising."

Google is set to take in more than 26% of all digital advertising revenue this year, according to an analysis from data firm Insider Intelligence. In total, tech giants Google, Amazon and Facebook-parent Meta will take in about 64% of the $200 billion in digital ad revenue generated this year, the study found.

Google rebuked the lawsuit's claims in a statement to ABC News.

"Today’s lawsuit from the DOJ attempts to pick winners and losers in the highly competitive advertising technology sector. It largely duplicates an unfounded lawsuit by the Texas Attorney General, much of which was recently dismissed by a federal court," a spokesperson said.

"DOJ is doubling down on a flawed argument that would slow innovation, raise advertising fees, and make it harder for thousands of small businesses and publishers to grow," the spokesperson added.

Google exploits a conflict of interest, the lawsuit alleges, since the company controls the technology used to both offer and purchase advertising space, as well as the largest ad exchange on which marketers are matched with publishers.

Further, the lawsuit accuses Google of using its market power to punish companies that purchase digital ads elsewhere and charge heightened fees for clients that buy ads on its platforms.

In turn, such "anticompetitive behavior" has forced potential competitors out of the digital advertising business and sidelined businesses that remain, the lawsuit said.

"Google has thwarted meaningful competition and deterred innovation in the digital advertising industry," the lawsuit said.

Copyright © 2023, ABC Audio. All rights reserved.


Ticketmaster's Taylor Swift ticket fiasco spurs new Senate hearing

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(WASHINGTON) -- It was a Ticketmaster meltdown that sent millions of Taylor Swift fans spiraling: lockouts, delays, hours of confusion and soaring aftermarket prices amid reports of scalpers.

During the November presale for Swift's upcoming "Eras" tour, Ticketmaster was forced to halt purchases for her shows, citing "extraordinarily high demands" and "insufficient remaining ticket inventory," drawing outcry from Swifties -- and the artist herself.

Now they face lawmakers.

"This garnered a lot of attention in November when Ticketmaster's systems failed during the presale for Taylor Swift's new tour, leaving millions of fans stuck in virtual queues for hours waiting to buy tickets," Sen. Dick Durbin, D-Ill., said Tuesday to open a Judiciary Committee hearing on the issue. "These issues are symptomatic, I think, of a larger problem. The ticketing and live entertainment markets lack competition and are dominated by a single entity: Live Nation."

In the fall, Ticketmaster said that "every ticket was sold to a buyer with a Verified Fan code."

"While it's impossible for everyone to get tickets to these shows, we know we can do more to improve the experience and that's what we're focused on," the company said then.

Ahead of Tuesday's hearing, lawmakers said they planned to focus on Live Nation and Ticketmaster's 2010 merger, which has given the company an outsized influence on the market -- with critics highlighting how they can raise ticket prices, shut out smaller venues and smaller artists and sideline rival ticket companies. The merger drew particular scrutiny from some members of Congress in the wake of the Swift ticketing fiasco.

"To have a strong capitalist system, you have to have competition. You can't have too much consolidation," Sen. Amy Klobuchar, D-Minn., said at the hearing. "Something that unfortunately for this country -- as an ode to Taylor Swift, I will say -- we know all too well."

Ahead of the hearing, Klobuchar told ABC News Senior Congressional Correspondent Rachel Scott that "if it's Taylor Swift fans that move some of my colleagues on monopolies, great."

"Some of the things that came out of the Taylor Swift concert were larger than life because it's Taylor Swift. But many of the things were things we've been hearing for years [about ticketing issues], and it's time to take this on. The fees are too high, and there's not enough competition," she said.

Top executives from the ticketing industry were set to testify, including the president and CFO from Live Nation, Joe Berchtold, and SeatGeek CFO Jack Groetzinger.

During Berchtold's opening statement, which was obtained by ABC News, he will point the blame at ticket-scalping, arguing that "breaking the law using bots and cyberattacks to try to unfairly gain tickets contributes to an awful consumer experience."

"There are problems in the ticketing industry -- problems that we believe can and should be addressed through legislation. Many are the direct result of the industrial-scale ticket scalping that goes on today, which is a $5 billion dollar industry in concerts alone and is fueled by practices that run counter to the interests of artists and fans," Berchtold plans to say.

Singer-songwriter Clyde Lawrence, from the band Lawrence, is also expected to testify with his bandmate Jordan Cohen. They say it's the overwhelming control Live Nation has over the industry that leads to lopsided deals.

"Our place is to tell some of the experiences that we have from the unique perspective of artists that are really hands on ... and just talk about some of the ways that we've run into road bumps about trying to get a fair deal for ourselves," Lawrence told Rachel Scott.

The musicians said that, as one example, they receive no profit from the fees Ticketmaster adds onto tickets: "We have zero say in setting what they are and we have zero participation in any of that money," Cohen said.

"We are looking to Live Nation, as the leader of the industry, to just give us a crumb, give us some breadcrumbs. I don't know if the government needs to get involved. That's, again, not our area of expertise," Cohen said. "But we would just hope that the industry leaders make a little bit of change."

ABC News' Libby Cathey contributed to this report.

Copyright © 2023, ABC Audio. All rights reserved.


Look who's replacing the M&M's spokecandies for the Super Bowl

M&M's

(NEW YORK) -- After an exciting weekend of NFL divisional round playoff games, the stage is closer to being set for Super Bowl 57. But in addition to teams who came up short on Saturday and Sunday, another major name will be sidelined from this year's big matchup.

M&M's announced Monday that its iconic "spokescandies" will sit out of the brand's advertisements this season to make way for their new spokesperson and "Chief of Fun," Maya Rudolph.

M&M's partnered with the beloved actress and comedy icon for the newly created role, in which Rudolph will "use her comedic talents and captivating personality to help M&M'S build on its mission to create a world where everyone feels they belong," a representative told ABC News' Good Morning America.

Rudolph's first appearance for the brand will be during the M&M's Super Bowl campaign on Sunday, Feb. 12.

"With the new role, Maya will serve as M&M’S new spokesperson, while the colorful cast of original spokescandies will step away to pursue other passions," the M&M's rep added.

In addition to sharing a sneak peek look at her first appearance, the brand urged fans to check out the candy's social media channels and tune in during and after Super Bowl 57 "to see what happens next."

Copyright © 2023, ABC Audio. All rights reserved.


IRS expects better tax season service thanks to Inflation Reduction Act funding

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(WASHINGTON) -- The Treasury Department is rolling out new measures aimed at improving customer service as the IRS starts to accept 2022 federal income tax returns.

Treasury Department Deputy Secretary Wally Adeyemo told reporters on Friday that the agency has used funds from the Inflation Reduction Act to hire more customer service staff and modernize decades-old technology.

That includes 5,000 new customer service workers to answer calls, Adeyemo said. Just 13% of 173 million calls to the IRS were fielded by live agents last year and 8% of calls were answered with automated assistance.

A Treasury Department official said the new hires mean the IRS has a "historic number" of workers ready to answer the phones this tax season, with the goal of reducing average wait times from 30 minutes to 15 minutes.

These workers will be trained and in place by Presidents Day weekend in late February, Adeyemo told reporters. The IRS also beefed up staffing at taxpayer assistance centers across the country, with 700 new hires.

Adeyemo said "meaningful progress" has been made to update technology. The IRS will now let taxpayers respond to notices for document verification and other issues electronically rather than by mail.

The IRS will continue to move towars automating the scanning of millions of individual paper returns, as it currently inputs the information from paper returns manually one number at a time.

"These customer service improvements will have a positive impact on tax filers, ensure returns are processed more quickly and taxpayers are able to access credits and benefits they're entitled to in a timely manner," Adeyemo said.

The IRS began to accept federal returns on Monday, and individuals have until April 18 to file. Taxpayers who request an extension will have until Oct. 16.

The agency's new resources come as congressional Republicans try to reclaim the money approved for the IRS in the Inflation Reduction Act -- which was opposed by every GOP lawmaker in the House and Senate. The law allocates roughly $80 billion for the IRS over the next decade.

Earlier this month, House Republicans voted to strip the funding in the first piece of legislation the new majority brought to the floor. Many GOP lawmakers misleadingly claim the money will result in the hiring of 87,000 new agents to target middle- and lower-class families, though ​​IRS Commissioner Charles Rettig said it will not increase audits of households making less than $400,000 per year.

The legislation has little chance of passing the Democratic-controlled Senate, and the Office of Management and Budget said in a statement that President Joe Biden would veto it if it came to his desk.

Treasury Secretary Janet Yellen has said a priority of the agency is to use the Inflation Reduction Act funding to clear the IRS backlog, as well as improve technology and hire more workers.

"Our work to improve services will continue throughout policies and the resources provided by the [Inflation Reduction Act] will continue to support a years-long transformation with the agency long after this filing season concludes," Adeyemo said Friday.

Copyright © 2023, ABC Audio. All rights reserved.


DOJ investigating conduct at Abbott infant formula plant

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(MICHIGAN) -- The Justice Department is investigating conduct at Abbott Laboratories' infant formula plant in Sturgis, Michigan, in connection with a contamination investigation that closed the plant last year, a source familiar with the matter told ABC News.

The monthslong shutdown of the plant amid a investigation helped trigger a nationwide formula shortage.

An Abbott spokesperson told ABC News, "DOJ has informed us of its investigation and we’re cooperating fully."

The DOJ did not immediately respond to a request for comment.

The Consumer Protection branch of the DOJ is conducting the criminal investigation, the source familiar said.

The discovery of Cronobacter sakazakii bacteria inside Abbott's Sturgis plant prompted a massive voluntary formula recall in February, after four babies who had consumed Abbott's formula contracted a Cronobacter infection.

Two of the infants subsequently died, although Abbott maintains there has not been conclusive evidence that its formula caused the infant illnesses, since none of the Cronobacter strains found at their plant matched the two samples genetically sequenced from the sickened infants.

Food and Drug Administration officials said the investigation remains ongoing.

Ultimately, it was the combined findings of Cronobacter inside Abbott's plant -- along with a pattern of serious operational deficiencies and consumer complaints -- which led to the plant's closure.

The plant reopened in June and restarted production of its largest formula Similac in August.
 

Copyright © 2023, ABC Audio. All rights reserved.


T-Mobile breached by hackers as 37 million customers impacted

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(NEW YORK) -- T-Mobile says they discovered a "bad actor" was taking information through a single application, according to an SEC filing by the company this week.

"The preliminary result from our investigation indicates that the bad actor(s) obtained data from this API for approximately 37 million current postpaid and prepaid customer accounts, though many of these accounts did not include the full data set," the SEC filing dated Jan. 19 says.

The wireless giant is facing the second major breach in as many years. They said the activity started on Nov. 25 and they notified the proper agencies when they discovered the hack on Jan. 5, 2023.

"We are continuing to diligently investigate the unauthorized activity," T-Mobile said. "In addition, we have notified certain federal agencies about the incident, and we are concurrently working with law enforcement. Additionally, we have begun notifying customers whose information may have been obtained by the bad actor in accordance with applicable state and federal requirements."

The company said they were able to trace the identity of the activity and stop it.

The Cybersecurity and Infrastructure Security Agency (CISA) has previously warned of major hacks occurring on or around holidays -- and it would appear this started around Thanksgiving.

The company says the most sensitive customer data wasn't taken but some personal information was.

"The API abused by the bad actor does not provide access to any customer payment card information (PCI), social security numbers/tax IDs, driver’s license or other government ID numbers, passwords/PINs or other financial account information, so none of this information was exposed. Rather, the impacted API is only able to provide a limited set of customer account data, including name, billing address, email, phone number, date of birth, T-Mobile account number and information such as the number of lines on the account and plan features."

After the first hack, the company says they went through extensive cybersecurity measures.

Copyright © 2023, ABC Audio. All rights reserved.


Google to cut 12,000 jobs from global workforce

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(NEW YORK) -- Alphabet Inc., the parent company of Google, said Friday that it will cut about 12,000 jobs from its global workforce, affecting approximately 6% of the company's employees.

"I have some difficult news to share," Google's CEO Sundar Pichai wrote in an email to Google employees on Friday morning. "We’ve decided to reduce our workforce by approximately 12,000 roles ... This will mean saying goodbye to some incredibly talented people we worked hard to hire and have loved working with. I’m deeply sorry for that. The fact that these changes will impact the lives of Googlers weighs heavily on me, and I take full responsibility for the decisions that led us here."

Employees who are being laid off in the United States will be paid during the notification period -- a minimum of 60 days -- and will also receive a severance package starting at 16 weeks salary plus two weeks for every additional year they spent at Google.

Google also said that they would pay out the 2022 bonuses and remaining vacation time to the employees that are being laid off as well as "six months of healthcare, job placement services, and immigration support for those affected."

"As an almost 25-year-old company, we’re bound to go through difficult economic cycles. These are important moments to sharpen our focus, reengineer our cost base, and direct our talent and capital to our highest priorities," Pichai said. "Being constrained in some areas allows us to bet big on others. Pivoting the company to be AI-first years ago led to groundbreaking advances across our businesses and the whole industry."

Pichai said that in spite of the layoffs, Google is "getting ready to share some entirely new experiences for users, developers and businesses."

"Google’s products are better than ever," he wrote. "We have a substantial opportunity in front of us with AI across our products and are prepared to approach it boldly and responsibly."

Said Pichai: "When I look around Google today, I see that same spirit and energy driving our efforts. That’s why I remain optimistic about our ability to deliver on our mission, even on our toughest days. Today is certainly one of them."

This is a developing story. Please check back for updates.

Copyright © 2023, ABC Audio. All rights reserved.


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