WARN Act 101

Do you understand the basics of the federal WARN Act? Here's a high-level breakdown.

Drew Dotson
November 18, 2021

What is the WARN Act?

The WARN Act, known formally as the Worker Adjustment and Retraining Notification Act, went into effect as a federal labor law in 1989. In the simplest terms, the WARN Act requires employers to provide written advanced notice in situations of qualified plant closings and other mass layoffs.

Why does WARN exist?

WARN was created to protect employees, their families, and communities by requiring that employers provide advance notification of significant business changes like plant closings and layoffs. The lead time allows employees and their families to prepare for the transition and enables communities to brace for the potential impact on local businesses.

Federal vs. State WARN

The federal WARN Act requires most employers with 100 or more employees to provide 60 calendar days of notice prior to a plant closing or mass layoff. Beyond the federal level, many states have implemented further requirements, often referred to as state or mini WARNs. Employers must understand the federal WARN Act and any location-specific WARN Acts.

What situations trigger the federal WARN Act?

If an employer is closing a plant or conducting mass layoffs, the WARN Act may be triggered. To interpret WARN appropriately, it’s important to define some key terms in the federal WARN Act.

An employer is a 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).

A plant closing is a permanent or temporary shutdown of a single site of employment — or one or more facilities or operating units within a single site of employment — if the shutdown results in an employment loss at the single site of employment during any 30-day period for 50 or more employees excluding any part-time employees.

A mass layoff is a reduction in force which, first, is not the result of a plant closing, and, second, results in an employment loss at the single site of employment 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.

The federal WARN Act includes additional provisions and exceptions. However, generally speaking, if an employer has more than 100 employees, WARN should be on the company’s radar when considering plant closings or mass layoffs.

What happens if an employer fails to adhere to the WARN Act?

Failure to adhere to the WARN Act can be quite costly. For example, employers who violate WARN provisions are liable for an amount equal to back pay and benefits for the period of the violation, up to 60 days, for every affected employee. Additionally, workers, their representatives, and local government may opt to file individual or class action lawsuits.

Additional Resources

This high-level overview contains the WARN basics. However, for further reading and specifics, review the following:

• The full text of the Worker Adjustment and Retraining Notification Act
Employer’s Guide to Advance Notice of Closings and Layoffs

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