The Worker Adjustment and Retraining Notification Act (WARN) is a federal law that was passed in 1988 and became effective in 1989. According to the Department of Labor, the act “protects workers, their families, and communities by requiring most employers with 100 or more employees to provide notification 60 calendar days in advance of plant closings and mass layoffs.” While this quote gives a general description of what the act does, more information is needed to understand which employers are required to follow the WARN Act and which employees may benefit from its protection.
As the quote says, a company must employ at least 100 workers for the WARN Act to apply. All 100 workers must have been employed by the company for at least six months and average at least 20 work hours per week. For example, a company that employs 65 people year-round and hires another 40 seasonal workers for three months would not be governed by the WARN Act.
Even companies that have 100 qualifying employees may be exempt in certain circumstances. If a company is trying to find investors to help keep the company afloat, and giving a 60-day notice to its employees would hinder this activity, the company may not be required to give the notice. If Mother Nature causes the company to be shut down due to a disaster such as a tornado, hurricane, or flood, the notice is not required because the closure could not be anticipated. In a similar vein, if a company suddenly loses a main source of income because of a cancelled contract or other unforeseeable issue, a 60-day notice may not be possible. In these cases, the companies are still required to provide notice of the layoffs or closure as soon as possible, and they must provide a viable reason why the full 60-day notice could not be given.
The next part of the act to consider is which employees are covered. In general, anyone working for a company that fits the criteria above would be covered, including salaried and hourly employees, managers and supervisors. There are exceptions though. Anyone working for a branch of the government – federal, state, or local – is exempt. Those who have accepted a position knowing it is temporary and those who are hired as self-employed contractors do not qualify. Individuals who are involved in a labor dispute lock-out or who participate in a strike are also not entitled to the 60-day notice.
Obviously, if a company is terminating a small number of people, a 60-day notice is not required. The term “mass layoff” applies to the dismissal of 50 or more employees at one time, or 500 or more employees over the course of 30 days. The WARN Act does not cover just complete layoffs. If 50 or more employees are going to have their work hours reduced by more than 50% for at least six months, they are entitled to the 60-day notice.
As an employee, what does the WARN Act do for you? It gives you a little more time to become adjusted to the fact that you will be unemployed, both financially and mentally. Also, when a mass-layoff is brought to the attention of the Department of Labor, a State Rapid Response Dislocated Worker Unit will work with the employer to provide information to help the displaced workers find jobs. This may include job training, remedial education, and information about the labor market.
The act also gives the employees the right to pursue legal action against a company if they are not notified 60 days before the mass layoff. If you think you have not been given the proper notification before being laid off, it is important to contact a Kentucky employment attorney who will review the facts of your situation and determine whether or not legal action should be taken. The employment attorneys at Miller & Falkner have over eight years of experience in helping people with all types of employment issues.