A closer look at the Federal WARN Act
Since we’ve covered the basics of the WARN Act, let’s take a deeper dive into the Federal WARN Act and its application. As a quick refresher, the WARN Act, known formally as the Worker Adjustment and Retraining Notification Act, requires employers to provide 60 days of written advanced notice in situations of qualified plant closings and other mass layoffs.
Federal WARN does not reign supreme.
First, it’s important to note that the Federal WARN Act does not supersede any laws or collective bargaining agreements that provide for additional notice or additional rights and remedies. If another law, such as a state WARN Act (mini-WARN) or agreement, provides for a longer notice period than the federally required 60 days, WARN notice runs concurrently with that additional notice period. Collective bargaining agreements may be used to clarify or amplify the terms and conditions of WARN but may not reduce WARN rights.
WARN is triggered when …
For purposes of WARN, “employer” means any business enterprise that employs—
(A) 100 or more employees, excluding part-time employees; or
(B) 100 or more employees who in the aggregate work at least 4,000 hours per week (exclusive of hours of overtime).
WARN notice is required when a covered employer:
Closes a facility or discontinues an operating unit, permanently or temporarily, affecting at least 50 employees (not counting part-time workers) at a single site of employment. A plant closing also occurs when an employer closes an operating unit that has fewer than 50 workers, but that closing also involves the layoff of enough other workers to make the total number of layoffs 50 or more;
Lays off 500 or more workers (not counting part-time workers) at a single site of employment during a 30-day period, or lays off 50-499 workers (not counting part-time workers) and these layoffs constitute 33% of the employer’s total active workforce (not counting part-time workers) at the single site of employment;
Announces a temporary layoff of less than 6 months that meets either of the two criteria above, and then decides to extend the layoff for more than 6 months. If the extension occurs for reasons that were not reasonably foreseeable at the time the layoff was originally announced, notice must be given when the need for the extension becomes known (Any other case is treated as if notice was required for the original layoff.); or
Reduces the hours of work for 50 or more workers by 50% or more for each month in any 6-month period. In other words, a plant closing or mass layoff does not have to be permanent to trigger WARN.
Yes, there are some exceptions to the full 60-day notice requirement.
Notice must be provided as soon as practicable, even when qualifying exceptions apply. Employers must provide the reason for reducing the notice requirement (i.e., why the exception applies) in addition to fulfilling other notice information requirements.
The exceptions are as follows:
Faltering company: When, before a plant closing, a company is actively seeking capital or business and reasonably in good faith believes that advance notice would preclude its ability to obtain such capital or business, and this new capital or business would allow the employer to avoid or postpone a shutdown for a reasonable period;
Unforeseeable business circumstances: When the closing or mass layoff is caused by business circumstances that were not reasonably foreseeable at the time that 60-day notice would have been required (i.e., a business circumstance that is caused by some sudden, dramatic, and unexpected action or conditions outside the employer's control, like the unexpected cancellation of a major order); or
Natural disaster: When a plant closing or mass layoff is the direct result of a natural disaster such as a flood, earthquake, drought, storm, tidal wave, or similar effects of nature. In this case, notice may be given after the event.
What should a WARN notice to employees include?
Employers are required to notify individual employees (or, in some cases, their representatives) at least 60 calendar days prior to a planned plant closing or mass layoff. In situations where terminations take place in phases, the date of the first individual termination within the statutory 30-day or 90-day period triggers the 60-day notice requirement.
If notifying employees directly, the notice must be written in a way that is easy to understand. It should contain:
A statement about whether the planned action is expected to be permanent or temporary and, if the entire plant is to be closed, a statement to that effect;
The expected date when the plant closing or mass layoff will begin, and the expected date when the individual employee will be separated;
An indication whether or not bumping rights exist; and
The name and telephone number of a company official to contact for further information.
Note that WARN also requires employers to provide notice to the state dislocated worker unit and to the chief elected official of the unit of local government where the plant is located.
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For more WARN wisdom …
Peruse the following links, which we used as sources for this article.
Code of Federal Regulations, Worker Adjustment and Retraining Notification
Department of Labor, Employer’s Guide to Advance Notice of Closings and Layoffs
Department of Labor, Notices for Plant Closings and Mass Layoffs
