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  • Nicholas Sekas

Employees must be “WARN”-ed

Given the current pandemic, and Executive Orders from the Governors of New Jersey and New York, we understand that many of our clients, just as we have as a business organization, have had to make some tough and disheartening decisions regarding their employees. While we continue to stay abreast of the developments in pharmaceuticals, and safety measures by our leaders, and remain hopeful that we will soon be past this pandemic, it is important that your employees know what they can expect moving forward, not only for continued company morale, but as may be required by Federal Law. If your organization employs at least one-hundred people not counting part-time employees, or has at least one-hundred employees, part-time or otherwise, who, in the aggregate, work at least 4,000 hours per week (i.e. 40 hours per work per person), then you may need to provide employees with a written notice of a temporary, or permanent, work-site closure or mass layoff. This article will explain, while not intending to offer legal advice which may be specific to your circumstance, under what situations WARN applies and what WARN requires.

Initially taking effect in 1989, the Worker Adjustment and Retraining Notification Act, or “WARN” Act for short, was enacted to ensure that displaced workers have sufficient notice to plan ahead or to seek additional training to prepare for a new field. Sufficient notice under WARN typically is sixty (60) days; however, as with any good statute, there are exceptions. WARN applied regardless of if the closure is temporary or permanent and regardless of it is a complete closure of a work-site or a partial layoff. To be considered a “site closure” the work-site must be closed entirely and result in a reduction in the workforce of fifty (50) or more employees in a thirty day period. A “mass layoff” on the other hand is considered a reduction in the number of employees which not the result of a work-site closure where the employees are reduced by at least one-third which amounts to at least fifty (50) employees being removed from the workforce or where the reduction in the workforce is five-hundred (500) or more employees, regardless of the percentage of the total number of employees at that particular work-site may be. If either of these circumstances arises, WARN typically requires at least sixty (60) days’ written notice to those misplaced workers.

At this point in the article, we are fairly certain that you are asking: how was I supposed to know there would be a worldwide pandemic? Fortunately, the WARN act provides for several exceptions. For our purposes, we focus on the “unforeseeable circumstance” exception which allows a business to reduce the time it would need to provide notice to employees if there is a business circumstance that was not reasonably foreseeable at the time when notice would have normally been required (i.e. sixty (60) days before the planned site closure or layoff). WARN requires that the employer issue written notices as soon as is practicable under that the “unforeseeable circumstance” exception. A written notice should, per applicable regulations inform the employee how long the closure or layoff is expected to last, what benefits, if any, may be available and who the employee may be able to contact if they have any questions or need more information.

The Department of Labor, who oversees the enforcement of the WARN Act, recommends that in situations even where the WARN Act may not be required, it is still recommended that employers advise employees ahead of time if they intend to layoff or close a work-site for any reason and for any length of time. What the Department of Labor’s recommendation reminds us is that organizations, big and small, should be open and honest with employees to the fullest extent possible, particularly now, in what has become a necessary halt to some sectors of our economy. This, and more information is available on the Department of Labor’s website regarding WARN and manner other issues that an employer may encounter. We encourage our clients to review their notification procedures and discuss with us any potential measures that could be taken.

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