In California, the Worker Adjustment and Retraining Notification (WARN) Act protects employees, their families, and communities by requiring covered employers provide advance notice to employees affected by plant closings and mass layoffs. For the purposes of the California WARN Act, closures can occur either by 1) a mass reduction-in-force, i.e. a layoff during any 30-day period of 50 or more employees at a covered establishment; 2) a relocation, or the removal of all or substantially all of the industrial or commercial operations in a covered establishment to a different location 100 miles or more away; or 3) a termination, or the substantial or total cessation of industrial or commercial operations in a covered establishment. Lab. Code § 1400(d-f).
The WARN Act is applicable to employers that employ, or have employed in the preceding 12 months, 75 or more full-time or part-time workers. Lab. Code § 1400(a). Typically, covered employers are required to provide at least 60-days notice regarding a work closure or mass reduction-in-force.
However, on March 17, 2020, Governor Gavin Newsom issued Executive Order N-31-20, addressing the California WARN Act and its 60-day notice requirement for closures of establishments. Recognizing that employers have had to rapidly close down their businesses to prevent or mitigate the effects of the COVID-19 pandemic, but have not been able to provide their employees the usual advanced notice of at least 60 days, the Executive Order provides conditional suspension of the usual 60-day notice requirement. The Executive Order does not suspend the Act in its entirety, nor does it suspend the law for all covered employers. Conversely, the Executive Order only suspends the Act’s 60-day notice requirement for those employers that satisfy the Order’s specific conditions.
For one, the employer’s mass layoff, relocation, or termination must be caused by COVID-19-related “business circumstances that were not reasonably foreseeable at the time that notice would have been required.” Additionally, the employer must provide written notices to employees affected by the mass layoff, relocation, or termination, as well as all representatives of employees affected, such as their union or attorney, the Employment Development Department, the Local Workforce Development Board, and the chief elected official of each city and county government within which the termination, relocation, or mass layoff occurs.
The notice given to employees must satisfy a number of requirements. The employer must provide as much notice as is reasonably possible at the time notice is given to employees and their representatives. The employer must also provide a brief statement as to why 60-day notification period could not be met and include the following statement: “If you have lost your job or been laid off temporarily, you may be eligible for Unemployment Insurance (UI). More information on UI and other resources available for workers is available at labor.ca.gov/coronavirus2019.”
For more information on the California WARN Act, click here: https://www.edd.ca.gov/Jobs_and_Training/Layoff_Services_WARN.htm
Employers experiencing a slowdown in business or services due to COVID-19 may alternatively apply for the Unemployment Insurance Work Sharing Program. This program allows employers to seek an alternative to layoffs through retaining their trained employees by reducing their hours and wages that can be partially offset with UI benefits. Workers of employers who are approved to participate in the Work Sharing Program receive the percentage of their weekly UI benefit amount based on the percentage of hours and wages reduced, not to exceed 60 percent.