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New Practice Area Alert: The WARN Act Is Coming

By Kevin Fayle on July 06, 2009 | Last updated on March 21, 2019
The Wall Street Journal Law Blog has alerted me to a new practice area that is heating up thanks to the continually deteriorating economy: WARN Act cases are apparently poised to become a hot topic of litigation over the coming months.

The WARN Act (or Worker Adjustment and Retraining Notification Act) is designed to give workers who work in certain locations for companies covered by the act a 60 day cushion before a round of mass layoffs.  The problem is that many companies are now claiming that the nature of the current downturn has prevented them from providing the requisite notice because events transpired too quickly to allow the business to wait before performing layoffs.
The Act does have exceptions: Companies on the brink can do away with the notice if it's determined that the announcement will hinder an attempt to raise additional capital. 

Quoth the Law Blog:

Since the recession began in December 2007, the U.S. Department of Labor says 3.8 million people lost jobs in about 37,000 mass layoffs, which it defines as groups of 50 or more. In May, 312,880 workers were part of mass layoffs, the highest level on record.

Only a small portion appear to be receiving the two-month cushion. The most recent look by the Government Accountability Office, in 2003, showed that one-quarter of mass layoffs met all the conditions for a WARN filing. Of those cases, only about one-third of companies gave the proper notice. Companies file WARN notices with their states, and there is no national database.

So for small firms and solo attorneys, this could represent another new opportunity created by the recession. 

Looks like it's time to brush up on your employment law.

See Also:
Companies, Workers Tangle Over Law to Curb Layoffs (Wall Street Journal)

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