When employers with 100 or more workers plan mass layoffs, they must provide advance notice to the affected workers. However, there are several exceptions to this law. When an exception applies, the notice requirements do not apply. If you have been laid off or terminated from your job, the attorneys at Swartz Swidler can review the situation to determine whether the law was followed.
Terminations and layoffs
Under the Fair Labor Standards Act, employers are not required to provide notice to workers before they are terminated from their positions. In most cases, the date when the employee is told that he or she is being terminated will be his or her final workday. New Jersey also has a law regarding mass layoffs and plant closures.
When an employee is fired, an employer will usually walk him or her out of the building after he or she has retrieved his or her belongings. Some employers make arrangements to meet fired workers after work to pick up their things when the employees do not want to return to the work area. In immediate terminations, employees normally do not receive any advanced notice that they are being fired from their jobs.
Under the WARN Act, covered employers are required to give workers advanced notice when a plant closure or mass layoff is planned. This law requires that employers give at least written notices 60 days in advance when they plan to lay off more than 50 workers in a 30-day period during a plant closing. Employers must also give their employees advanced notice of a mass layoff that will not lead to a plant closure when 500 or more workers will lose their jobs during a 30-day period. For employers with 50 to 499 employees, advanced notice must be given if the workers who will lose their jobs make up a third or more of the active workforce.
Employers are not required to give notice under federal law when their planned layoffs are not covered under the WARN Act. When an employer has economic reasons for conducting layoffs, the workers will normally experience an immediate loss of employment.
When a department or job function will be eliminated, the workers may be asked to continue working for months or weeks. In these types of situations, the employer may promise bonuses and recommendations so that the shutdown or transfer of responsibilities can be orderly.
Exceptions to the WARN Act
There are several exceptions to the 60-day advanced notice requirement under the federal WARN Act. When an exception applies, employers are not required to provide 60 days of written advanced notice to their employees.
If a company is faltering before a plant closing and is actively searching for business or capital, it may not be required to provide advanced notice of a plant closure to the employees. This exception applies when the employer has a good faith, reasonable belief that providing advanced notice would prevent the company from securing the sought-after business or capital and the business or capital might allow the company to postpone or avoid a closure for a reasonable amount of time.
Mass layoffs and plant closings that occur because of business circumstances that were not foreseeable at the time that a 60-day notice would otherwise have been required also meet an exception to the WARN Act’s notice requirements. The regulations under the WARN Act offer some examples of what an unforeseeable business circumstance might include. One indication of unforeseeability is a circumstance that is dramatic, sudden, unexpected, and outside of the control of the employer. For example, a large strike at an employer’s major supplier, a major economic downturn, or sudden termination of a large contract could all be deemed to be unforeseeable business circumstances.
Courts engage in a fact-specific inquiry to determine whether an employer’s mass layoff was necessary because of an unforeseeable business circumstance. The inquiry looks at the reasonable judgment of the business as compared to the judgment of similarly situated companies when they predict demand in the market.
The third exception to the WARN Act’s notice requirement is a natural disaster. When a disaster forces a mass layoff or plant closing, notice may be provided to the workers after the event occurs.
What happens when a WARN Act exception applies?
Even when an exception to the WARN Act applies, events that trigger the act will still require that employers provide notice to their employees. In these cases, the written notices must include a statement about why the employees were not provided with 60 days of advanced notice.
On April 14, 2020, New Jersey Governor Phil Murphy signed two amendments to New Jersey’s law regarding advanced notice requirements for mass layoffs and plant closings. These amendments were retroactive to March 9, 2020, which was the date that the state declared an emergency because of COVID-19. Under these amendments, mass layoffs that happen because of national emergencies do not trigger the notice requirements. The amendments also delayed the effective date of several changes that were scheduled to take place in July, including changing the notice period from 60 days to 90 days and requiring severance pay for all affected workers.
Penalties for WARN Act violations
Employers that are found to have violated the WARN Act may face substantial liability. They may be ordered to pay affected employees back pay and benefits for every day that the violation occurred for up to 60 days. They may also be ordered to pay $500 fines for every day that the employers failed to provide advanced notice of a planned mass layoff to the local government. Employers may reduce the amounts that they have to pay in benefits and back pay if they paid benefits and wages to their workers during the period of violation. If the employers give back pay to all of their affected employees within three weeks of when the layoffs occur, they can avoid being assessed the $500 penalties.
Get help from Swartz Swidler
If you suddenly lost your job in a mass layoff or plant closure without notice, you may have legal rights to recover back pay and benefits. An employment lawyer at Swartz Swidler can analyze what happened and explain the legal rights that you might have. Call us today at 856.685.7420 to request a consultation.