The Worker Adjustment and Retraining Notification (WARN) Act is a critical piece of legislation mandating employers provide a 60-day advance notice of significant layoffs or plant closures. This federal law is intended to give employees ample time to prepare for impending job loss, seek alternative employment, or pursue retraining opportunities. If an employer fails to provide the required notice, affected employees are entitled to compensation for each day of the violation.

WARN Act Claims

What are Examples of the WARN Act?

The federal WARN Act applies to employers with 100 or more full-time employees. Covered events include plant closures affecting 50 or more employees and mass layoffs impacting at least 33% of the workforce or 500 employees, whichever is fewer. Here are some examples illustrating how the WARN Act applies:

Example 1: Plant Closure

A manufacturing company with 200 employees decides to shut down a factory, affecting 80 workers.

Notice Requirement: The company must provide a 60-day advance notice to the affected employees and local officials.
Covered Event: This qualifies as a plant closure since it affects more than 50 employees.

Example 2: Mass Layoff

A retail chain with 1,000 employees plans to lay off 350 workers.

Notice Requirement: A 60-day notice is required.
Covered Event: This is a mass layoff as it affects at least 33% of the workforce.

Example 3: Faltering Company Exception

A struggling tech firm with 150 employees lays off 60 workers with 30 days’ notice, claiming it is a faltering company.

Exception Consideration: The company must prove it was seeking investment and believed notice would hinder obtaining it.
Legal Scrutiny: The employer must demonstrate that the conditions for the exception are met.

Example 4: Unforeseen Business Circumstances Exception

A hotel chain with 500 employees experiences a sudden drop in bookings due to a natural disaster and lays off 200 workers with 10 days’ notice.

Exception Consideration: The hotel chain can invoke the exception of unforeseen business circumstances.
Legal Scrutiny: The employer must show the layoffs were directly caused by the unforeseen event.

Example 5: Sale of a Business

A corporation sells a division with 150 workers. The new owner lays off 100 within 30 days.

Notice Requirement: Both the seller and buyer may need to provide notice.
Covered Event: The layoff qualifies as a mass layoff.

Example 6: Temporary Project

A construction company with 400 employees completes a project and lays off 100 workers.

Notice Requirement: If the project was known to be temporary, notice may not be required.
Covered Event: If layoffs were unexpected, it qualifies as a mass layoff.

California WARN Act (Cal-WARN) differs slightly from the federal law, in that it applies to employers with 75 or more employees. Covered events include plant closures or mass layoffs affecting 50 or more employees and relocations involving the transfer of all or substantially all of a facility’s operations to a different location 100 miles or more away.

What Is the Penalty if an Employer Violates the Warn Act?

If an employer violates the WARN Act, they are liable for back pay and benefits for each affected employee for the period they failed to provide the required notice, up to 60 days. Additionally, employers may face civil penalties of up to $500 per day for each day of violation, payable to the local government, unless they pay the employees the owed amounts within three weeks. These penalties are designed to ensure employers adhere to the advance notice requirements and compensate employees for the sudden loss of income and benefits.

Filing a WARN Act Claim

If you believe your employer has violated the WARN Act, you have the right to file a claim. Here’s a step-by-step guide to help you through the process:

Gather Evidence: Collect all relevant documents, including employment contracts, company notices, and any communication related to the layoff or closure. This evidence will be crucial in supporting your claim.
Consult an Employment Lawyer: An experienced Orange County Employment Lawyer can help you understand your rights, assess the validity of your claim, and guide you through the legal process.
File a Complaint: You can file a complaint with the U.S. Department of Labor (DOL) or pursue a lawsuit in federal court. Your lawyer can assist you in determining the best course of action based on the specifics of your case.
Legal Proceedings: If you decide to file a lawsuit, your lawyer will help you prepare the necessary documents, represent you in court, and negotiate any settlements. It’s important to note that successful WARN Act claims can result in significant compensation for lost wages and benefits.

How Can an Attorney Help?

Pursuing an Orange County wage and hour claim can present several challenges, including proving that your employer’s actions fall within the scope of the WARN Act and are not an exception. An attorney can be invaluable in assisting you by:

Gathering Evidence

Attorneys help collect and organize necessary documentation, such as employment records, notices, and communications, which are crucial for supporting your claim.

Navigating Legal Procedures

They will guide you through the complex legal procedures, whether filing a complaint with the Department of Labor or pursuing a lawsuit.

Negotiating a Settlement

Lawyers can negotiate with your employer to seek a fair settlement, potentially avoiding a lengthy court battle.

Representing You at Trial

If the case goes to court, an attorney represents you, presenting your case effectively and advocating for your rights.

Types of Compensation Available

There are several types of compensation you may be entitled to:

Back Pay: The amount of compensation you would have earned for each day of violation, up to a maximum of 60 days.
Benefits: The value of any benefits you would have received during the notice period, including health insurance, pension contributions, etc.
Interest: Interest on the amount of back pay and benefits owed, calculated from the date of the violation.
Attorneys’ Fees and Costs: The court may order your employer to pay for legal fees and court costs.

After evaluating your case, an employment lawyer can give you an estimate of the amount of compensation you can potentially recover.