Learn how the WARN Act applies to layoffs due to acquisitions and natural disasters. Discover when exceptions may apply and the importance of consulting legal counsel to ensure compliance.
Table of Contents
Question
An acquisition makes it likely that several lines in a factory will close shifting work to another facility. This would mean the loss of more than 500 jobs. Before that can happen a natural disaster damages the factory. Management wants to lay off the workers now. What should HR advise about complying with WARN?
Answer
Because of the natural disaster, the employer may be excepted from WARN and should consult a lawyer.
Explanation
The Worker Adjustment and Retraining Notification (WARN) Act requires most employers with 100 or more employees to provide 60 calendar days advance written notice of plant closings and mass layoffs. However, there are three exceptions to the 60-day notice requirement:
- Faltering company
- Unforeseeable business circumstances
- Natural disaster
In this scenario, the acquisition itself would not be an exception to the WARN Act’s 60-day notice requirement for the planned closure of factory lines and layoff of over 500 workers. The employer would normally need to provide the full WARN notice.
However, the natural disaster that damaged the factory before the planned layoffs could potentially qualify as an exception to the 60-day WARN notice requirement. If the disaster was sudden, unexpected, and directly caused the need to lay off workers earlier than planned, then the unforeseeable business circumstances or natural disaster exception may apply.
The employer would still need to give as much notice as is practicable, provide a brief statement of the reason for reducing the notice period, and otherwise comply with WARN requirements. But they may not need to provide the full 60 days’ notice.
Given the complexities of WARN Act compliance, exceptions, and the specific facts at hand, HR’s advice to management should be to consult with an experienced employment lawyer. The lawyer can provide a full assessment of whether an exception to the 60-day notice requirement legitimately applies in this case based on the natural disaster. This will help ensure the company avoids potential liability for WARN Act violations.
In summary, while the acquisition itself doesn’t allow the employer to avoid WARN, the natural disaster might, if it was unforeseeable and directly caused the need for layoffs. However, the safest course is to get an attorney’s advice on whether an exception truly applies to ensure full compliance with the law.
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