Do You Need To WARN Your Employees?
These are difficult times throughout the country and layoffs are becoming an unfortunate reality for some employers. Even in this pandemic, there are California requirements that employers should be mindful of as they navigate this painful process.
Layoffs are always a difficult undertaking for all concerned. However the impact of the various coronavirus relief legislation and the large expansion of unemployment benefits for displaced workers has caused many employers to consider whether a furlough/layoff might be more economically helpful for employees. If that is the decision, under the California Worker Adjustment and Retraining Notification (WARN) Act,1 employers that have employed 75 or more full and part-time employees in the preceding 12 months must provide 60 days' advance notice before conducting a mass layoff (among other things). For California purposes, a mass layoff is defined as a layoff of 50 or more employees within a 30-day period. Employers that fail to provide such notice can be liable to affected employees for up to 60 days of back pay and benefits, as well as possible civil penalties.
However, if any of us could have predicted this pandemic 60 days ago, we would probably find you beating the house at a blackjack table in Vegas (once they re-open, that is) and not reading this article. Recognizing this predicament, California Governor Gavin Newsom recently issued an Executive Order concerning COVID-19 which suspends some of the requirements of the California WARN Act – particularly as to the 60 day notice requirement. An employer seeking to rely on the Executive Order must satisfy all of following conditions:
- The employer’s mass layoff must be caused by COVID-19-related “business circumstances that were not reasonably foreseeable at the time that notice would have been required.”
- The employer must provide written notices to affected employees, all representatives of the affected employees (e.g., unions), the EDD, the Local Workforce Development Board, and the chief elected official of each city and county government within which the mass layoff occurs.
- The employer must provide written notice that
- Gives as much notice as is reasonably possible;
- Provides a brief statement as to why the 60-day notification could not be met;
- Includes the following statement: “If you have lost your job or been laid off temporarily, you may be eligible for Unemployment Insurance (UI). More information on UI and other resources available for workers is available at ca.gov/coronavirus2019”; and
- Includes the following information:
- Name and address of the employment site where the mass layoff will occur
- Name and phone number of a company official to contact for further information.
- Statement as to whether the planned action is expected to be permanent or temporary.
- Expected date of the first separation, and the anticipated schedule for subsequent separations.
- Job titles of positions to be affected, and the number of employees to be laid off in each classification.
- In the case of layoffs occurring at multiple locations, a breakdown of the number and job titles of affected employees at each location.
- An indication as to whether or not bumping rights exist.
- Name of each union representing affected employees, if any.
- Name and address of the chief elected officer of each union, if applicable.
The WARN Notice must be sent to all employees via any reasonable method of delivery that ensures receipt by the affected employee (for example, first class mail, personal delivery, email, etc.). It must also be provided to the EDD, the Local Workforce Development Board, and Chief Elected Officials.
There are many employers who do not technically fall under the WARN Act either by way of size or severity of the layoff. However, it is possible that an employer will need to do a second round of layoffs which could arguably bring them under this umbrella. We are currently advising some of our employer clients who are facing intermittent and continuing layoffs, to provide compliant notice as a belts-and-suspender approach until there is more predictability in their workforce. 2
Layoffs are something that no employer wants to face but it can create a hotbed for future litigation if not done properly. For more information or to discuss any of your employment concerns, please contact our employment attorneys at Hall Griffin LLP.
1 There is also a federal equivalent of the California WARN Act that provides for similar requirements.
2 We do recommend that the letter be sent to the agencies with an appropriate cover letter which disclaims coverage under the WARN Act. Please feel free to contact either of the authors should you need personalized recommendations.