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Summary

Congress has passed legislation to facilitate the reemployment of workers who through no fault of their own are let go by their employers. Among these laws is the Worker Adjustment and Retraining Notification (WARN) Act, P.L. 100-379, enacted in 1988. The WARN Act requires employers to provide written notice to displaced workers or their representatives, state dislocated worker units or entities designated by the state to carry out rapid response activities, and the chief elected official of a unit of local government at least 60 days before a plant closing or mass layoff is expected to occur. Shorter notice may be provided in three instances. Other exceptions to and exemptions from the notification requirement exist. Relatively small businesses and small temporary layoffs are not subject to the WARN Act. Firms with 100 or more employees, excluding part-time employees, generally must provide advance notice if a mass layoff is expected to exceed six months. A mass layoff is an employment loss at a job site within any 30-day period affecting (1) 50-499 employees (excluding part-timers) if they make up at least one-third of an employers workforce (excluding part-timers), or (2) at least 500 employees (excluding part-time employees). A plant closing is a shutdown of a work site that produces job losses for at least 50 employees (other than part-timers) within any 30-day period. Although part-time employees are not counted toward the acts size thresholds, they are entitled to advance notice. Employees, their representatives, or units of local government can bring civil actions against employers thought to have violated the act. The Department of Labor (DOL) does not have any investigative or enforcement authority. The maximum liability of employers is back pay and benefits for each day that notice was not provided, although the amount of the penalty may be reduced. Congressional interest in the WARN Act has renewed during the current decade due in part to growth in offshore outsourcing, perceived shortcomings of the statute, and the onset of a recession in December 2007. On June 25, 2009, the FOREWARN Act (H.R. 3042 and S. 1374) was introduced. The bills would require firms employing at least 75 employees to provide notice 90 days before a covered mass layoff or plant closing is to take place. As a result of lowering the size threshold for employer coverage under the act from 100 full-time employees and lowering the size threshold for covered employment losses from at least 50 full-time employees, H.R. 3042 and S. 1374 would expand the scope of the WARN Act. The bills also would authorize DOL to attempt to resolve administratively complaints of WARN Act violations and to bring civil actions on behalf of workers. Further, the Secretary of Labor and the governor of the state in which affected worksites are located would be added to those receiving notices. H.R. 3042 and S. 1374 would in turn require the Secretary to notify the appropriate Senators and House Members of impending layoffs and closings not later than 15 days after employers provided the notice to DOL. The bills would increase to two days the back pay penalty for violations of the notice requirement to which employers are subject as well.

Related Legislation:
• H.R.3042
• S.1374

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