Articles

Client Alert - New State WARN Act Adds to Worker Rights

By Peter Porcino & Robert Riether

Jun. 25, 2009

The Federal Worker Adjustment and Retraining Notification (WARN) act was first enacted in 1989 and requires notification to employees 60 days in advance of a mass layoff or plant closing.  New York State recently adopted its own version of the WARN Act.  The New York State Worker Adjustment and Retraining Notification Act (“NY WARN”) extends coverage, significantly strengthens worker rights and increases the burdens on employers.  The law took effect on February 1, 2009. 

This client alert will highlight the key worker rights enhancements under New York’s legislation.  The statute contains numerous exemptions; you should check with legal counsel to determine if it applies to your situation. 

Events Triggering Application of WARN Act:

New York has added “Relocations” to the list of events that will trigger the warning notice.  Relocations are defined as removal of all or substantially all of the industrial or commercial operations of an employer to a location at least 50 miles from the current location.  This is in addition to a mass layoff or plant closing provided under both the Federal and New York statutes.

Employers Covered:

The New York law covers employers with 50 or more full-time employees or 50 or more employees working at least 2,000 cumulative hours per week.  The Federal law only applies to employers with 100 or more full-time employees or 100 or more employees working at least 4,000 hours per week.

Number of Employees Affected to Constitute a Mass Layoff:

A “Mass Layoff” under NY WARN occurs when 25 or more full-time employees (and at least 33% of all full-time employees), OR at least 250 full-time employees (regardless of percentage), are laid off within a 30-day period.  The Federal WARN Act applies when 50 or more full-time employees (and at least 33% of all full-time employees), OR at least 500 full-time employees (regardless of percentage), are laid off within a 30-day period. 

Plant Closing Definitions:

NY WARN defines a “Plant Closing” as a shutdown resulting in an employment loss of at least 25 full-time employees within the same 30-day period.  The Federal WARN Act only applies to an employment loss of at least 50 full-time employees within a 30-day period. 

Minimum Advance Notice:

NY WARN requires 90 days’ advance notice to employees of a Plant Closing, Mass Layoff or Relocation.  The Federal WARN Act requires only 60 days’ notice. 

Penalties for Violations:

NY WARN does not add any new penalties for violations to those imposed under the Federal WARN Act.  Like its Federal counterpart, NY WARN mandates back pay and benefits for each affected employee for up to 60 days, depending upon when the notification was actually given.  Both acts also allow for reasonable attorneys’ fees to any prevailing plaintiff, in the court’s discretion.  Finally, the Federal WARN Act and NY WARN both allow for employer penalties of up to $500 per day for each day of the employer’s violation, but any amounts paid under the Federal WARN Act reduce amounts imposed under NY WARN.  Employers under both acts can avoid employer penalties by paying any amounts due to affected employees within 3 weeks of the triggering event.  All of the statutory liabilities, fees and penalties are subject to reduction by the court upon a showing of good faith.

Enforcement:

The Federal WARN Act provides only for a private right of action (the affected employee may seek recovery).  NY WARN, in addition to the private right of action, provides for administrative enforcement of remedies by the New York State Department of Labor, giving New York a much more powerful enforcement tool. 

*  *  *  *  *

If you are considering any type of downsizing, you must comply with Federal and now the even more stringent New York State worker notification requirements.  If you have any questions or would like any more information regarding employment issues, please contact Peter Porcino or one of our employment law attorneys at Cowan, Liebowitz & Latman, P.C.

Back to top