Layoffs? Are You Aware Of The WARN ACT?
On January 1, 2003, the California WARN Act became law. CA Labor Code Section 1400-1408 expanded on the requirements of the federal WARN Act that was effective February 4, 1989. The state and federal WARN Acts have different definitions and since California has a broader definition, California employers should follow its guidelines rather than the federal guidelines.
“WARN provides protection to employees, their families, and communities by requiring employers to give affected employees and other state and local representatives notice 60 days in advance of a plant closing or mass layoff. Advance notice provides employees and their families some transition time to adjust to the prospective loss of employment, to seek and obtain alternative jobs and, if necessary, to enter skills training or retraining that will allow these employees to successfully compete in the job market (http://wwwedd.cahwnet.gov/Jobs_and_Training/Layoff_Services_WARN.htm).”
WARN is required when a plant closure or mass layoff occurs during any 30 day period and affects 50 or more full- or part-time employees who worked for the employer at least 6 of the 12 months prior to the date the employer was required to notify its employees. Generally, temporary employees are not covered under WARN, neither are Independent Contractors.
Unforeseeable circumstances, such as an act of God, an act of war, or a mass layoff that occurs that’s reasonably outside the employer’s control does not require WARN to be implemented. Other situations that do not require WARN are when a “faltering company (defined as a company that is trying to remain in business by soliciting additional capital or business)” goes out of business, or if a large contract job with the government is unexpectedly terminated.
If you have any questions about WARN, or are unsure whether you are required to notify employees of a plant closure or a mass layoff, please contact our office to see if your company qualifies. The penalties for not following WARN guidelines are quite severe. Back wages and benefits must be paid to each affected employee for each day of the violation, up to a maximum of 60 days. If the proper government agencies were not notified, the fines are $500 per day, up to a maximum of 60 days.
Written and submitted by Rodger Questin
Can you tell me if the WARN applies to government contractors providing services under government contracts to the Federal government?
Yes, the WARN Act would apply if you have at least 100 employees and you intend to lay of at least 25% of the employees you have to give a 60 day notice.