The WARN Act: Protecting Employees During Mass Layoffs

1. Understanding the WARN Act

The Worker Adjustment and Retraining Notification (WARN) Act is a federal law that ensures advance notice in cases of qualified plant closings and mass layoffs. It requires employers with 100 or more employees to provide a 60-day notice to affected workers or pay them if notice is not given. The purpose of the WARN Act is to give employees time to prepare for the transition between jobs and seek new employment opportunities. In this comprehensive guide, we will explore the key provisions of the WARN Act, including who is covered, what triggers notice requirements, how to file a WARN notice, and the penalties for non-compliance.

What is the WARN Act?

The Worker Adjustment and Retraining Notification (WARN) Act is a federal law that requires employers with 100 or more employees to provide a 60-day notice in advance of mass layoffs or plant closings. The purpose of the WARN Act is to give employees time to adjust to the loss of employment, seek alternative job opportunities, and participate in any necessary retraining programs. It applies to full-time workers who are not on a temporary assignment.

Who is Covered by the WARN Act?

The WARN Act covers private employers as well as public and quasi-public employers in a commercial context. However, ordinary federal, state, and local government entities offering public services are not covered. To be subject to the WARN Act, an employer must have at least 100 full-time employees or a combination of at least 100 part-time and full-time employees who work a total of 4,000 hours per week. Part-time employees are defined as those who work fewer than 20 hours each week or who have been employed for fewer than six months.

2. Triggering Notice Requirements

Layoffs and Plant Closings

The notice requirement of the WARN Act is triggered in several situations.

First, if a plant closing or mass layoff results in the involuntary termination of employment for at least 50 employees during a 30-day period, and these employees make up at least one-third of the workforce, the employer must provide a 60-day notice.

Second, if the number of employees laid off during a 30-day period is 500 or more, regardless of the percentage of the workforce, the employer must also give a 60-day notice.

Lastly, if an entire work site is closed down, and at least 50 employees are laid off during a 30-day period, the employer must provide a 60-day notice.

Temporary Layoffs and Extensions

Temporary layoffs that meet the criteria for a mass layoff or plant closing but were initially intended to be temporary can trigger the notice requirement if they become permanent or exceed six months. However, if the extension of the temporary layoff was not reasonably foreseeable, the employer may be exempt from providing a 60-day notice.

Reduction of Hours

If an employer reduces the work hours of a group of employees by 50% or more during each month of a six-month period, and this reduction affects a sizeable employee group, it may trigger the notice requirement. The same notice rules apply in this situation.

3. Filing a WARN Notice

Methods of Delivery

When notifying employees of a plant closing or mass layoff, employers have several acceptable methods of delivery. These include:

• First-class mail
• Personal delivery with optional signed receipt
• A notice in the employee’s pay envelope

However, it is important to note that a preprinted notice included in each employee’s paycheck or pay envelope does not meet the requirements of the WARN Act.

Steps to File a WARN Notice

To file a WARN notice, employers should email the notification to eddwarnnotice@edd.ca.gov. The email should include the name of the employer in the subject line, the notification as an attachment or within the email body, and contact information in case additional information is required. It is essential to ensure that the attachments are compatible with Microsoft Office or Adobe Reader software.

4. Rapid Response Teams and Support

Assistance for Employers and Workers

In the event of a mass layoff or plant closing, Rapid Response Teams are available to provide assistance to both employers and workers. These teams consist of staff from the Employment Development Department (EDD) and Local Workforce Development Areas (Local Areas). The Rapid Response Teams provide information about adult and dislocated worker services available under the Workforce Innovation and Opportunity Act (WIOA). These services can include employment and case management, training benefits, trade readjustment allowances, job search allowances, relocation allowances, and alternative or reemployment Trade Adjustment Assistance (TAA) programs.

Trade Adjustment Assistance (TAA) Program

If a worker’s dislocation is the result of foreign competition or relocation, they may be eligible for the Trade Adjustment Assistance (TAA) program. This program offers additional benefits such as employment and case management services, training benefits, trade readjustment allowances, job search allowances, relocation allowances, and alternative or reemployment Trade Adjustment Assistance.

5. Penalties for Non-Compliance

Employers who fail to provide the mandatory 60-day notice may be required to provide back pay and benefits to affected employees for each day that notice was not given, up to the mandatory 60 days. Back pay includes wages and benefits such as health care coverage. In addition to back pay, employers may be subject to penalties of up to $500 for each day of violation. If the case is resolved in court, the employer may also be responsible for paying reasonable attorney’s fees and costs.

6. State-Specific WARN Laws

California WARN Act

In addition to the federal WARN Act, California has its own version of the law with stricter criteria. The California WARN Act covers employers who employ 75 or more employees, including part-time employees working less than 20 hours per week. Unlike the federal WARN Act, the California law requires notice for mass layoffs of 50 or more employees, regardless of the percentage of the workforce. It also requires notice for plant closures of any size. Employers in California must comply with both the federal and state WARN Act provisions.

New York WARN Act

Similarly, New York has its own WARN Act that establishes longer notice periods and lowers the number of workers required to trigger the notice. Employers in New York with at least 50 full-time employees must provide 90-day notice prior to plant closures or mass layoffs affecting either one-third of the workforce (at least 25 employees) or 250 employees from a single site. Employers in New York must comply with the state-specific WARN Act provisions.

Conclusion

The Worker Adjustment and Retraining Notification (WARN) Act is a crucial piece of legislation that provides employees with protection and advance notice in the event of mass layoffs or plant closures. By understanding the key provisions of the WARN Act, employers can fulfill their obligations and employees can prepare for the transition between jobs. It is important for employers to be aware of the triggering events that require notice, how to file a WARN notice, and the potential penalties for non-compliance. Furthermore, employers should be mindful of state-specific WARN laws, such as the California WARN Act and the New York WARN Act. By adhering to the requirements of the WARN Act, employers can ensure a smoother transition for their employees and maintain compliance with the law.

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