Laws You Should Know,The Worker Adjustment
and Retraining Notification Act (WARN)

03/05/07

If you’re contemplating layoffs, and you employ more than 100 people, WARN is one law you’ll need to know in detail. Here are the facts.

Why: WARN is designed to protect workers and communities from sudden, unexpected job losses.
Who: You’re covered by WARN if you employ more than 100 people, not including employees who have been with you less than six months (in the last twelve months). You also don’t have to count those who work less than twenty hours a week. Both private and nonprofit employers are covered, but not governmental entities that provide public services.
What: Covered employers must provide sixty days’ notice before closing plants or before a mass layoff of workers. A plant closing is defined as when a facility or operating unit is closed for more than six months, or when 50 or more employees at a single site lose their jobs at one worksite during any thirty-day work period. A mass layoff is defined as 500 or more employees losing their jobs within a thirty-day period. The law also applies when you’re laying off between 50 and 499 workers and the specific number represents at least 33 percent of your total, active workforce.

Notice is not required if you’re closing a temporary facility, or if you’ve ended a temporary project and workers knew when they were hired that the job was short-term.

How: There are no required forms to fill out, but you must provide a written notice to employees providing the specifics of the layoff. According to the Code of Federal Regulations, the notice must contain:

(1) A statement as to 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;
(2) The expected date when the plant closing or mass layoff will commence and the expected date when the individual employee will be separated;
(3) An indication whether or not bumping rights exist;
(4) The name and telephone number of a company official to contact for further information.

If you’re unionized, you can send a single notice to the workers’ representative(s).

You must also notify your state’s “Dislocated Worker Unit” as well as the chief elected official of your local government.

Exceptions to the 60-day rule: There are three instances in which less than sixty days’ notice is permissible (but beware—employers bear the burden of proof in establishing that the following conditions are met):

1. Faltering company. You’re in trouble, and a public announcement of a plant closing or layoff would hurt your chances to get new capital or new customers;
2. Unforeseeable business circumstances;
3. Natural disaster. The closing or layoff must be a direct result of the disaster.

If you don’t comply: If you violate WARN, you can be liable to each “aggrieved” employee for back pay and benefits for the period of the violation, up to a maximum of sixty days. You can also be liable to your local government up to $500 for each day of the violation.

If you’re seriously contemplating an action that falls under WARN’s provisions, head to http://www.dol.gov/dol/compliance/comp-warn.htm for more detailed background information. Since layoffs can spark lawsuits in a variety of areas, it’s also prudent to secure the services of a competent, local employment attorney.