COVID-19 Layoffs? Beware of WARN Act
Employers should heed compliance
WARN Act will be important during COVID-19 fallout
As the COVID-19 quarantines continue, many companies are struggling and will be forced to perform mass layoffs or plant closings. As companies go through the decision-making process related to these layoffs, they should make sure they stay compliant with the Workers Adjustment and Retraining Notification Act (WARN).
The WARN act requires employers with 100 or more full-time employees as defined by the Act to provide at least 60 calendar days advanced written notice of a plant closing or mass layoff affecting 50 or more employees at a single site of employment.
The act extensively defines “plant closing” and “mass layoff”. It also has specific provisions requiring notices to employees, unions and certain government entities. However, there are situations where WARN does not require 60 days advanced notice.
When does WARN Act dismiss the 60 day notice?
These situations include unforeseen business circumstances. While the COVID-19 pandemic could likely meet the requirements of this exception, the Department of Labor has not currently provided a ruling. Therefore, it is not certain whether the notice requirement will be enforced for layoffs related to COVID-19.
Failure to comply with WARN can lead to significant fines. Therefore, it is very important to understand if your situation requires you to provide advanced notice. We suggest to discuss your particular situation with your attorney if you are not sure to mitigate potential penalties.