Downsizing Your Company? Keep The WARN Act In Mind
Employment attorney Keith Clouse discusses federal requirements for large-scale worker layoffs
The Worker Adjustment and Retraining Notification (“WARN”) Act is a federal law which requires certain covered employers to give advanced written notice to employees who will be affected by a large-scale layoff or plant closure. Employers are covered by WARN if they have a minimum of one hundred employees who are full-time (excluding employees who have been working less than six months and those who work less than twenty hours each week) or a minimum of one hundred employees who work a combined total of 4,000 or more hours per week.
The WARN notice requirement is triggered when a specific amount of workers are expected to lose their job as a result of a “mass layoff” or “plant closing.” The statute defines a “mass layoff” as a “reduction in force which … results in an employment loss at the single site … during any 30-day period for (i) at least 33 percent of the active employees, excluding part-time employees, and (ii) at least 50 employees, excluding part-time employees.” 29 U.S.C. § 2101(a)(3). In addition, if 500 or more employees will be affected, then the notice is required, regardless of whether that amount is more or less than 33 percent of the total employees. The term “plant closing” is defined as “the permanent or temporary shutdown of a single site of employment … if the shutdown results in an employment loss during any 30-day period for 50 or more employees, excluding part-time employees.” 29 U.S.C. § 2101(a)(2).
When one of the above situations occur, employers covered by WARN must notify the affected employees in writing at least 60 days prior to the layoff or closure. If those employees are members of a union, the employer is just required to notify the union representative. Employees who are laid off with less than the 60-day notice may be able to recover lost benefits and wages.
There are several exceptions when an employer does not have to give the required notice under WARN. For example, a large-scale layoff or plant closure that is due to an employee strike does not require any mandatory notice. Other exempt situations include natural disasters, unforeseeable business circumstances, and a faltering company. However, in those circumstances, employers must still provide employees with as much notice as possible and explain why the 60-day requirement was unable to be met.
To best reduce the risk of liability, any large employer considering a mass layoff, reduction in force, or plant closure should consult with an attorney to ensure that the notice requirements under WARN will be satisfied.
This article is presented by the Dallas employment lawyers at Clouse Dunn LLP. To speak with an employment attorney about a layoff or termination matter, send an email to email@example.com or call (214) 239-2705.
About Keith Clouse / Dallas Employment Lawyer Keith Clouse
Keith Clouse is a Texas employment law specialist with over 25 years of experience representing senior executives, business owners, physicians, and corporations in complex employment litigation, arbitration, and negotiations. Senior executives, physicians and other professionals consistently rely on Mr. Clouse for employment law expertise and advice on employment contracts, covenants not to compete, severance agreements, trade secret disputes, breach of fiduciary duty claims, and claims based on workplace discrimination, retaliation, and harassment. Source CDKLawyers.com
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