WARNing - Part Two

Like New Jersey, New York also has recently implemented changes to its plant closing law. The NY WARN requires covered employers to provide affected employees with at least 90 days notice of an employment loss. The NY WARN applies to employers with 50 or more employees (WARN applies to employers with 100 or more employees) and requires 90 days notice (WARN requires 60 days). The NY WARN also defines mass layoff more broadly than WARN (layoff of at least 50 full time employees and 33 percent of the workforce, or at least 500 employees). Under NY WARN, a mass layoff is a reduction of force of at least 25 employees and 33 percent of the workforce or at least 250 employees.

NY WARN also more broadly defines "plant closing" as the permanent or temporary shutdown of a single site of employment resulting in an employment loss for 25 or more full time employees in a 30 day period. Federal WARN defines plant closing as a loss of 50 or more employees in a 30 day period.

Like the NJ law, NY WARN requires notice to employees and their collective bargaining representative.

Employees aggrieved under NY WARN can seek relief from the Dept of Labor or through a private lawsuit. Penalties include backpay up to a maximun of 60 daysor half the number of days the employee was employed by the employer, whichever is lesser.

In sum, the new NY WARN law applies to smaller employers and smaller reductions of force, and requires more notice, than its federal counterpart.

WARNing - Don't Forget Local WARN Acts - Part One

The federal WARN Act generally requires employers with over 100 full time employees to provide 60 days notice in the event of a plant closing or mass layoff. Many states have their own versions of WARN as well and businesses implementing covered employment changes must make sure to comply with all applicable plant closing laws.

For example, New Jersey recently implemented the Millville Dallas Airmotive Plant Job Loss Notification Act. This new law requires notice to the Commissioner of Labor and Workforce Development, the chief elected official of the municipality where the establishment is located, each employee to be terminated and the collective bargaining representative. Note that federal WARN requires that each employee receive notice only if not represented by a union.

The penalties under the NJ law are more draconian than under the federal counterpart. Under WARN, liability is reduced based on the amount of notice provided by the employer. Under the NJ law, failure to give the full 60 days subjects an employer to the full penalty, which is one week of severance for each full year of employment in addition to any other employer-provided severance. While back pay received under WARN is credited against the NJ sevevrance entitlement, there is no 60 day cap.

Moreover, NJ law does not recognize the faltering business and unforeseen business circumstances exceptions recognized under WARN, which is particularly significant in the current economic climate. Even loss of a major customer will not excuse compliance with the NJ requirements.

In addition, the "State Response Team" can provide workers with information regarding their legal rights, in addition to job placement counseling, which could influence an employee to bring a claim.

Finally, under the NJ law, an employee who is offered a job in NJ and within 50 miles of the establishment does not suffer an employment loss. WARN requires the new job to be within reasonable commuting distance. Covered businesses in NJ need to comply with both.