Over 200 Y7 Yoga Staff Were Moved to a Payroll That Stopped Paying and What They Can Do Now

A yoga chain that once ranked among the fastest growing private companies in America has closed every studio, and the people who taught its classes are still chasing their last paychecks. Inc. reports that the sudden closure of the brand's eight studios sent shock waves through the Y7 community, catching instructors and students by surprise. One user commenting on a Y7 Studio Instagram post said they were upset to hear staff were not paid and that a paid-in-full annual membership was now lost. At Metaintro we cover closures from the worker's side, and this one has a twist that changes what staff should do next. The company that hired you may not be the company that still owes you.

What happened

Y7 was not a struggling startup for most of its life. Inc. notes that the brand secured the No. 40 spot on the 2018 Inc. 5000, after co-founders Sarah Larson Levey and Mason Levey started the company in 2013 as an alternative to more traditional yoga studios. It grew from Brooklyn pop-ups to over a dozen studio locations across New York, Los Angeles, Chicago, and even a spot on Nike's campus in Portland, Oregon.

The long slide began with the pandemic. A summary of the founder's account published by Deals ATX says the Chicago flagship shut in early 2020, just days after opening, and that the brand went with no revenue for nearly 18 months while leaning on cash reserves and a 51% stake from private equity firm KarpReilly, secured in January 2020. By 2024 the business had recovered to six studios and nearly $10 million in revenue, but capital constraints led the board to approve a sale to FitLab, a fitness and sports lifestyle holding company, in late 2024.

The deal became public early the next year. Athletech News reported in February 2025 that Y7, then a brand with studios in New York, California and a studio in Austin, Texas, had been acquired by FitLab. Two weeks later, the same outlet reported that FitLab had also acquired New York City-based Mile High Run Club, a boutique running studio with three locations, which matters later in this story.

The worker story starts after that sale. According to the same Deals ATX account, tensions emerged in June 2025 when FitLab rejected employee raises, and FitLab later demanded a 25% to 30% cut in labor costs, despite profitability. Six salaried employees, including three long-serving staff, were laid off, class offerings dropped, teacher training programs shut down and the West Hollywood studio closed entirely.

Then the employer itself changed. Deals ATX reports that by mid-July the founder received notice that the new operator had taken over the yoga brand's operations, and that the operator, whose identity was not verified, could not be reached for comment. The founder discovered on August 7 that payroll had been missed, and wrote to the new operator that over 150 people rely on those paychecks to support their families before resigning.

Over 200 instructors and staff were moved from FitLab's payroll to the new operator, and payments halted immediately, according to Deals ATX.

The final weeks were chaotic. Former studio lead Trevor Leeper, who had worked at Y7 for nearly three years, described towel services stopping and said the last couple weeks have been terrible. By late August, locations began shutting down one by one, with clients receiving emails that the location was now closed, often hours after instructors were notified. In an email to employees, the new operator acknowledged payroll delays and said final pay should be complete within the next week.

Y7 was not the only FitLab brand to go through a handoff like this. Reporting at Athletech News found that when the Nike Studios concept wound down, the majority of the Nike Studios locations were transitioning to FitLab's owned portfolio of fitness brands, with Y7, Racked, Mile High Run Club and XPT named as the receiving brands. An investigation by Hybrid Fitness Media then documented what happened at some of those brands, reporting that FitLab formally ended its employment relationship with workers at Racked Culver City, Racked Newport Beach, and Mile High Run Club Nomad on May 29 and told staff who wanted to stay to apply with a new operator, VM Fitness.

Less than three months later, VM Fitness told employees on Aug. 20 that it would permanently close Racked Culver City at the end of business the following day, citing landlord disputes and past challenges from previous ownership. A coach there said she had not received her regularly scheduled paycheck for wages earned between Aug. 1 and Aug. 15 when the closure was announced, and Hybrid Fitness Media reports that coaches had filed wage claims and were still waiting for payment. None of the coverage reviewed here names Y7's new operator. Deals ATX says only that FitLab transferred operations of two other brands to an unnamed entity in April 2026, so it would be wrong to assume VM Fitness and Y7's operator are the same company. The pattern is the point. Workers were moved off the parent company's payroll, onto a smaller operator's, and the pay stopped soon after.

Where the coverage agrees, and where it splits

Every account agrees on the core facts that matter to staff. The studios closed with little warning, the closures came after a change of operator, and instructors say wages went unpaid. Inc. and the Deals ATX summary both describe eight studios closing, and both draw on the founder's account for the history.

The headcount is where the numbers diverge. The same account says over 200 instructors and staff moved to the new payroll, while the founder's own email said over 150 people rely on those paychecks. The account does not explain the gap. For a wage claim, neither number matters as much as your own pay records.

There is also a dating error worth flagging. The Deals ATX photo caption says the eight locations shut down permanently in 2024, while its own body describes a missed payroll on August 7 and closures from late August after the 2024 sale. The body is consistent with Inc.'s September reporting. If you file anything, use the dates on your own emails and pay stubs, not a date copied from coverage.

The framing splits harder than the facts. Inc. tells a founder story, a fast-growing brand that closed under new ownership. Hybrid Fitness Media tells a portfolio story, citing an April lawsuit over nearly $904,000 in alleged unpaid construction work at Nike Studios locations and an eviction case at Culver City. The portfolio framing is the more useful one for workers, because it shows how pay can stop after a handoff to a new operator.

What none of the coverage covers is the law, and the primary documents are where the practical answers live. The U.S. Department of Labor says the WARN Act helps ensure advance notice in cases of qualified plant closings and mass layoffs, and that the U.S. Federal Court solely enforces the Act, so a WARN dispute goes to court rather than to a labor office. The federal regulation defines an employer as one with 100 or more employees, excluding part-time employees, or with 100 or more employees, including part-time employees, who in the aggregate work at least 4,000 hours per week.

Even a covered employer only owes notice for a plant closing when it causes an employment loss during any 30-day period at the single site of employment for 50 or more employees, excluding any part-time employees. Unless a single studio had 50 or more non-part-time staff losing their jobs, that federal closing rule would not be triggered. State versions are broader but still have floors. New York's law applies to private businesses with 50 or more full-time employees in New York State and requires notice 90 days prior to a plant closing. California's version reaches a covered establishment that employs or has employed in the preceding 12 months, 75 or more full and part-time employees, counting part-time staff in that headcount.

What this means for your job search

Start by working out who your employer of record was on your last day, because that is who owes you. Payroll for over 200 instructors and staff moved from FitLab to the new operator this summer, so the company name on your final pay stubs may not be FitLab or Y7. Screenshot your schedule, your last pay stubs, any emails about the transfer and the closure notice now, before accounts and inboxes are shut off.

Do not wait on a promise. The operator told staff that final pay should be complete within the next week, and at Culver City the ownership group said it would begin reaching out Monday to discuss paychecks. The U.S. Department of Labor says that if the regular payday for the last pay period an employee worked has passed and the employee has not been paid, contact the Department of Labor's Wage and Hour Division or the state labor department. The Wage and Hour Division takes complaints at 1-866-487-9243 and says investigations often start from complaints, which are confidential. That is the move to make the day after a missed payday, not a month later.

Know which state's rules you are under, because they differ sharply. The federal government does not require immediate payment, and the Department of Labor notes that some states may require immediate payment. California is one of those states.

In California, an employee who is discharged must be paid all of his or her wages, including accrued vacation, immediately at the time of termination, according to the state Labor Commissioner.

If a California employer willfully misses that deadline, the Labor Commissioner says it may be assessed a waiting time penalty equal to the employee's daily rate of pay for each day the wages remain unpaid, up to a maximum of thirty (30) calendar days. For a Los Angeles instructor, that can mean up to 30 days of pay on top of what is already owed. Put it in your claim.

The claim itself is not complicated. The Labor Commissioner's Office says workers in California have the right to file a wage claim when their employers do not pay them the wages or benefits they are owed, and that wage claims can be filed online, by email, mail or in person. After filing, in most cases, a settlement conference between the employee and employer is scheduled to resolve the issues, and if that fails a hearing is scheduled so a hearing officer can review the evidence.

File for unemployment the same week, and do not let an unresolved wage dispute delay it. California's Employment Development Department describes benefits as temporary income for eligible workers who lost their job through no fault of their own, paying from $40 to $450 each week, depending on how much you earned in the past 18 months. A step by step guide to applying for unemployment benefits walks through what to have ready.

Then think about what you actually own. The Deals ATX account reports that Leeper and another former instructor are considering independently reopening the Silver Lake studio. That is a reminder of what a closure cannot take away. Your regulars, your class style and your certifications travel with you, and a teacher who can bring students along is a stronger candidate at any studio or gym hiring in your city. If you are weighing your options, what yoga instructors actually earn is a useful baseline before you negotiate with a new studio.

Our argument is that the warning signs here were visible long before the doors closed, and workers in similar businesses should learn to read them. A refusal to give raises, a demand to cut labor costs by a quarter or more, and a transfer of staff to an operator nobody can name are not three separate events. Together they describe a business being prepared for exit. Workers rarely get WARN protection in small, multi-site service chains, because federal closing notice depends on 50 or more full-time job losses at a single site, so your early warning system is your own attention. When you see that sequence, start lining up the next role while you are still being paid, the same way workers facing a plant closure are told to plan before the final shift.

Finally, keep your own records outside the employer's systems from now on, wherever you work next. Payroll platforms, scheduling apps and company email can all disappear in a handoff, and every claim you might need to make depends on dates, hours and pay rates you can prove.

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People Also Asked

Q: Did Y7 have to give a WARN notice before closing?

A: It depends on headcount. The federal regulation covers employers with 100 or more employees, excluding part-time employees, or 100 or more including part-time staff who together work at least 4,000 hours a week, and a plant closing must cause job losses for 50 or more non-part-time employees at a single site. New York and California have broader state versions, so ask the state labor department where you worked.

Q: How quickly does an employer have to pay final wages after a closure?

A: It depends on the state. The U.S. Department of Labor says federal law does not require immediate payment but some states do. In California, a discharged employee must be paid all wages, including accrued vacation, immediately, and willful delays can add a waiting time penalty of up to 30 days of pay.

Q: What should instructors do if the operator that owes them has gone quiet?

A: File a wage claim with your state labor department rather than waiting. Coaches at a closed former Nike Studios location in Culver City filed wage claims after pay stopped, and Y7 staff were told final pay should be complete within the next week. A claim keeps your place in line if that promise slips.

Looking for your next opportunity? Instructors, studio leads and front desk teams bring client retention, class programming and scheduling skills that gyms, wellness brands and hospitality employers are hiring for right now. Metaintro matches fitness and service talent to employers with open roles. Create a free profile and start your search today.