The Ultimate Guide to the WARN Act

Introduction

Enacted in 1988, the Workers Adjustment and Retraining Act popularly referred to as the WARN Act is a notice designed to protect employees, their family and their community from abrupt economic instability. The WARN Act was put in place to specifically protect them from mass closures, plant closings and in some cases relocations. In this blog post, we will dive into the complexities of its requirements, learn a little about its history and give an in-depth explanation of all the things you should know about the WARN Act and how it affects you. 

What is the WARN Act?

The WARN Act is a U.S. labour law enacted in 1988 but fully took effect on February 4, 1989. The policy requires employers under covered establishments to provide 60 calendar day notices in preparation for massive layoffs and plant closures. 

History of the WARN Act 

The WARN Act in its initial stages faced adversity from President Ronald Reagan. His refusal to sign the bill was however overruled through a majority Democratic congress with enough Republican support. Together, they achieved the 66% majority vote required to overrule President Ronald Reagan’s refusal. 

In 2001, mass layoffs and plant closures resulted in approximately 660,000 employees losing their jobs without notice. The WARN Act which was already in effect by 2001, required the respective employers to subject their employees to notice. However, the unfortunate circumstances surrounding the 2,000 mass layoffs and plant closure currently act as a reference point for the importance of the WARN Act.

Further revisions to the WARN Act include the recommendations made by the U.S. Government Accountability Office (GAO) in 1993 and 2003. GAO called for a simplification of the calculation of thresholds, clarification of definitions such as the word employer, clarification on damage calculation and establishment of a uniform statute of limitations. Overall GAO deemed the WARN Act difficult to apply when employers and employees assess their applicability. 

The WARN Act was mentioned in history in 2013 following the sequestration under the Obama administration. The administration felt it unnecessary and inappropriate for Federal contractors to provide WARN Act notices 60 days in advance of the potential sequestration due to the uncertainty regarding the bill.

Definitions of key terms surrounding the WARN Act

Before we get into the essentials of the WARN Act, it is important to understand some of the language used when discussing the WARN Act. Below are some common terms associated with the WARN Act. 

Mass Closure

A situation where a large number of full-time employees at a single site of employment are let go. This applies during any 30-day period where at least 33% of the full-time employees or if 500 or more full-time employees are affected by employment loss. 

Plant Closing

The closure of a single site of employment or one or multiple operating units within the site of employment. This applies during any 30-day period where 50 or more workers are affected by the plant closure. 

Covered Establishments

These are establishments with 75 or more full and part-time employees in the 12 months preceding the notice of the layoff, closure or at times relocation. 

Employer

An establishment with a minimum of 100 full-time employees or 100 or more employees including part-time workers provided their total weekly hours exceed 4,000 hours. This does not apply to federal, state or local governments, public or quasi-public entities and federally recognized Indian tribal governments. 

Notice

A warning in writing including information such as the name and address of the employment site, reasons behind the mass layoff or plant closure, the number affected of employees and their positions and contact information of a company official for additional information.

Bumping rights

A system put in place to provide for an employee to displace another employee as defined in a collective bargaining agreement. They are often based on seniority. 

What are the requirements of the WARN Act?

1. Employers must provide affected employees with a 60-day notice before a plant closing or mass layoff.
2. Employers must notify the State Rapid Response Dislocated Worker Unit and the chief elected official of the local government.
3. An employer must give notice to the chief elected officer of the representative or bargaining agency of a given employee. In the event the employee does not have a representative the notice must be issued directly to them.
4. The notice must contain information regarding, the name and address of the employment site, specificity on the temporary or permanent nature of the layoff or closure, reasons behind the layoff or closure, the number and positions of affected employees, declaration of bumping rights and contact information of a company office for additional information. 

Who is protected under the WARN Act?

Employees part of private non-profit, private for-profit or quasi-public entities that fit the criteria of a covered establishment. It is important to note employees subject to employment loss due to bumping rights must also be notified and, therefore, are also protected under the WARN Act. 

Who is not protected under the WARN Act?

Although the law is put in place to protect employees from unlawful layoffs, not all employees are entitled to a WARN Notice. This, however, should not exempt them from receiving a notice. Below are employees who are not entitled to WARN Act notices.

1. Employees who have worked less than six months within the past year.
2. Employees who work an average of less than 20 hours per week.
3. Federal, state and local government employees.
4. Employees contracted under temporary projects and are made aware of the terms.
5. Strikers or employees locked out in a labour dispute. 
6. Business partners, consultants and contract employees assigned to a given business but are employed by separate entities or are self-employed. 

Is my state covered under the WARN Act?

The majority of the states are covered under the federally mandated WARN Act, however, states such as New York, Illinois and California have separate provisions that apply to their state specifically. These state provisions go further in depth with states such as New York requiring a 90-day notice instead of a 60-day notice. These state-individual requirements further encourage transparency. 

States with specific provisions include:

• California
• Connecticut
• Illinois
• Massachusetts
• New York

Are there circumstances that do not require an Employer to issue a WARN Act notice? 

Any given employer that meets the criteria for a covered establishment is required to give a 60-day notice requirement. However, there are scenarios where the employer may be excused from the full 60-day requirement. This could be because of issues such as,

Physical Calamity or Acts of War

If a physical calamity or an act of war results in a mass layoff or plant closure, the employer is not required to issue a notice.

Capital or Business Pursuits

Under multiple and specific conditions a notice of relocation or termination is not required if the employer submits documents to the Department of Industrial Relations that prove the employer was actively seeking capital or business. This is because a WARN notice may have impacted their search for capital or business. 

Unforeseeable business circumstances

If the mass layoff or plant closing is a result of circumstances that could not have been reasonably predicted at the time a 60-day notice would have been required, employers are excused from giving a notice.

How does it assist employees? 

You may be asking yourself how the WARN Act is helpful or you may be wondering how the government assists workers who have fallen victim to mass closures and plant closings.

1. In submitting a notice to the State Rapid Response Dislocated Worker Unit, the unit can coordinate with the employer to provide information on retraining services available at their disposal or about new employment opportunities they can take advantage of. 
2. Allows employees ample time to transition and seek alternative opportunities.
3. It offers employees legal protection from unlawful mass closures or plant closings. 
4. It may offer a temporary means of support through severance pay and continued benefits. 
5. Offers a means of empowerment for the employees as it provides avenues for equitable and fair labour laws.
6. Promotes transparency between employer and employee which is important in fostering an equitable relationship between the parties. 

Retraining services may include:

• Labour market information
• Job search and placement assistance
• Entrepreneurial training 
• Career counselling 
• Resume writing workshops

What if my rights under the WARN Act have been violated?

If you feel as though your rights under the WARN Act have not been effectively upheld, it is important to reach out to a legal entity and seek further advice. In reporting the violation of your rights you may stand to gain benefits such as:

1. Issuance of an amount equal to back pay and benefits for the period of violation for up to 60 days.
2. A civil penalty of 500$ for each day of the violation.
3. Issuance of a reasonable attorney fee as part of the costs. 

Therefore, if you suspect your rights have been violated, begin the process of filing a claim and ensure you collect adequate evidence that clearly outlines the shortcomings of your employer in regard to following the WARN Act. Remember to utilize resources such as lawyers. 

Where do I find data on recent layoffs and plant closures? 

All data surrounding recent layoffs is available to the public through the WARN database. Alternatively, you can visit the official labour department website for your respective state. Either of these options provides you with the necessary information regarding mass closures, layoffs or relocations.

How can I effectively support my team following a WARN Act notice? 

Undoubtedly layoffs and closings are difficult topics to navigate. They have both physical and mental effects on employees. It is important to show support to your workmates if they are going through this experience. Different ways you can show support include:

1. Stay in touch with them. It is easy to lose the connection you may have bonded over with your workmates once they are laid off. It is also possible your workmate shares the anxiety of being forgotten and losing some of the friends they have made during their time at the company. In order to help them feel supported and appreciated during this time, it is important to stay in touch with them. 
2. Offer a listening ear. A lot of the time we tend to assume how other people are feeling. Take a step back and listen to your workmate, often they just need someone to talk to.
3. Share your connections and network. It is inevitable your workmate is going to be looking for an alternative work arrangement. Offering your network and some of your connections is a great way to show your support for the journey ahead.
4. Let them know they are valued and appreciated. Dealing with a layoff may have an effect on one's self-esteem. It is important to remind your workmate of the things they have accomplished during their time at your workplace. Ensure they feel confident in themselves and see value in their skills.
5. Attend networking events with them. It may be scary to navigate the networking scene fresh especially coming from a stable job. Show your workmate support by offering to go with them to some of the networking events tailored to job seekers. In doing so they can ease up their nerves and feel comfortable knowing you are there for their support.

There are endless ways you can help your workmate navigate this difficult time. Make sure you tap into some of the resources you have to help them make this journey easier.

Conclusion 

We have discussed a wide array of information regarding the WARN Act. The key takeaway from this blog is you have rights. You have rights tailored to help you navigate the work experience in a just and equitable way. The WARN Act was enacted to encourage transparency between employer and employee, arm employees with legal support and allow for a smoother transition in between jobs. It is your responsibility to not only educate yourself on these resources but also utilize them if need be. Stay informed. Stay educated.