Monitoring COVID-19 and the WARN Act
As COVID-19 continues to spread, impacting business operations around the country and causing employers to lay off workers, employers must consider whether the elimination of jobs triggers notice requirements under the Worker Adjustment and Retraining Notification Act “(WARN Act”).FN1
The WARN Act requires employers with 100 or more full-time workersFN2 to provide notice of at least 60 calendar days in advance of a plant closing or mass layoff.FN3 The WARN Act looks at employment losses that occur over a 90-day period; thus, separate but related layoffs over that period of time can trigger coverage.FN4
Many states also have“ mini-WARN” statutes which will require compliance and monitoring for developments. For example, California has temporarily suspended the 60-day notice requirement of its mini-WARN statute for COVID-19 related business circumstances that were not reasonably foreseeable, as long as employers still issue appropriate and complete notices as soon as possible and include mandated language.FN5
Takeaway
The duration of COVID-19’s impact on businesses is currently unknown and notice is not required under the WARN Act if the mass layoff does not last more than six months; however, notice generally cannot be provided retroactively. Exceptions to the WARN Act’s 60-day notice requirement include mass layoffs caused by “business circumstances that were not reasonably foreseeable as of the time that notice would have been required” or due to natural disasters.FN6 We expect the U.S. Department of Labor to provide clarification and guidance on whether the COVID-19 pandemic qualifies under these exceptions in the coming weeks. Campbell Litigation, P.C. will continue to monitor changes and can provide guidance to employers to ensure compliance with the WARN Act.
Footnotes:
FN 1 - 29 U.S.C. § 2101 et seq.
FN 2 – Under the WARN Act, a part-time employee are workers who have been employed fewer than six of the previous twelve months and employees who average less than 20 hours per week. See 29 U.S.C. § 2101(a)(8).
FN 3 - A plant closing is the permanent or temporary shutdown of a single employment site or one or more facilities or operating units with a single site, which results in job loss for 50 or more employees during a 30-day period. See 29 U.S.C. § 2101(a)(2). A mass layoff is a reduction in force that results in job loss at a single employment site, during a 30-day period, for (1) 500 or more full0time employees, or (2) 50 to 499 full-time employees, if the laid-off employees make up at least one-third of the employer's active workforce. See 29 U.S.C. § 2101(a)(3).
FN 4 - 29 U.S.C. § 2102(d)
FN 5 - See California Executive Order N-31-20, https://www.gov.ca.gov/wp-content/uploads/2020/03/3.17.20-EO-motor.pdf
FN 6 - 29 U.S.C. § 2102(b)