The Worker Adjustment and Retraining Notification (WARN) Act and its California counterpart, the California Worker Adjustment and Retraining Notification (CalWARN) Act, are laws designed to protect employees from abrupt job loss. These laws require employers to provide advance notice before conducting mass layoffs, plant closures, or substantial operational changes. However, in some cases, businesses may find themselves in a situation where compliance is impossible. This blog explores the triggers for potential violations of these laws and what steps companies should take to mitigate the effects of non-compliance.
Triggers for WARN Act and CalWARN Act Violations
Mass Layoffs: Both the WARN Act and CalWARN Act require companies to give employees 60 days' notice before laying off a specific number of employees within a 30-day period. The WARN Act applies to companies with at least 100 full-time employees, while the CalWARN Act applies to companies with 75 or more full-time or part-time employees.
Plant Closures: If a company plans to close a facility, resulting in the loss of employment for a specific number of employees, advance notice is also required under both Acts.
Substantial Operational Changes: While the WARN Act does not specifically address operational changes, the CalWARN Act requires notice for any substantial change in operations, such as a relocation or cessation of a significant portion of the business.
What to Do When Violating WARN Act or CalWARN Act is Inevitable
Despite the best intentions, companies may find themselves in situations where compliance with WARN or CalWARN is impossible. This can be due to unforeseeable business circumstances, natural disasters, or other extraordinary events. In such cases, it is crucial to take appropriate measures to mitigate the effects of non-compliance.
Consult with Legal Counsel: When faced with a potential violation, it is essential to consult with experienced legal counsel to understand the specific requirements of the WARN Act and CalWARN Act, evaluate potential defenses, and assess the risks associated with non-compliance.
Provide as Much Notice as Possible: Even if a company cannot provide the full 60 days' notice, it should still strive to give as much advance notice as possible. This will demonstrate good faith efforts to comply with the law and may help to reduce potential penalties.
Communicate with Employees: Open and honest communication with affected employees is critical during this time. Providing information about the reasons for the violation, the steps the company is taking to address the situation, and any available resources for employees (such as job placement assistance, severance packages, or access to unemployment benefits) can help maintain employee morale and goodwill.
Review and Update Policies and Procedures: Companies should take the time to review and update their internal policies and procedures related to layoffs and plant closures to ensure compliance with WARN and CalWARN requirements in the future.
Document Your Actions: It is crucial to maintain detailed records of the actions taken to address the violation, including any efforts made to provide notice, communications with employees, and steps taken to mitigate the impact on employees. These records may be valuable in the event of a legal challenge.
While violating the WARN Act or CalWARN Act is never ideal, companies may find themselves in situations where compliance is not possible. In these cases, taking appropriate steps to mitigate the effects of non-compliance is essential. By consulting with legal counsel, providing as much notice as possible, maintaining open communication with employees, reviewing policies and procedures, and documenting actions, companies can navigate through these challenging circumstances and minimize potential legal and financial risks.
Comments