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Walmart Closing 269 Stores; Does the WARN Act Apply?

By Christopher Coble, Esq. | Last updated on

Walmart announced last week that it will be closing 269 stores and laying off thousands of employees by the end of the month. But the news isn't all bad for the brand -- the mega-retailer also announced plans to open 300 to 400 new stores in the next year, most of those overseas.

It's worse news for the thousands of employees that may need to find new jobs. Due to this concern, federal law requires employers to alert employees before mass layoffs and possibly provide skill training or retraining programs for affected workers. So does the law apply to Walmart's store closures? And did they comply?

Duty to WARN

The Worker Adjustment and Retraining Notification (WARN) Act requires employers with more than 100 employees to provide a 60-day notice of mass layoffs. Under WARN, mass layoffs are defined as either affecting 500 employees at a single site, or at least 50 employees that comprise over 33 percent of the total employees for a single site. There are exceptions to the WARN Act, and the Act does not apply to part-time employees who average less than 20 hours per week.

While Walmart certainly employees more than 100 workers and could be laying off up to 10,000 of them, the site-specific requirements of WARN might not be met here. Without knowing the inner workings of Walmart's employment practices, it seems unlikely that the chain had more than 50 full-time employees at any specific location, much less 500. Other large retailers have similarly been able to skirt WARN's notification requirements by having large amounts of employees scattered across many locations.

Walmart's Warning

Which is not to say that Walmart is treating its affected workers unfairly. Business Insider reported that the company would try to place employees laid off at the closing locations at other Walmart stores. And those that couldn't be rehired would receive 60 days of pay and severance, along with résumé and interview skills training.

Most employers don't look forward to mass firings. And even if WARN doesn't apply, there are several state and local laws that may protect employees involved in large scale terminations. To find out if these laws apply to your business or employees, you should contact an experienced employment attorney near you.

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