The New Jersey Employment Law Firm Blog
According to some analysts, New Jersey is experiencing a net loss of residents and businesses, which means it is also losing jobs. When a business decides to cease operations in an entire state, a significant amount of job loss is probably inevitable, but the state has enacted laws that offer some protection to workers in this type of situation. The NJ WARN Act, more officially known as the Millville Dallas Airmotive Plant Job Loss Notification Act of 2007, establishes procedures that many businesses must follow when they take certain actions that result in major job loss. This includes a detailed notification that must be provided to each affected worker. Employers that fail to provide the required notification may be liable for damages to their employees.
The NJ WARN Act generally applies to businesses that have operated in New Jersey for at least three years and that have 100 or more full-time employees. Their obligations under the statute are triggered by certain events, including a “mass layoff,” a “transfer of operations,” and a “termination of operations.” N.J. Rev. Stat. § 34:21-1. The statute defines a “mass layoff” as a “reduction in force” that is not related to a transfer or termination of operations and that results in the termination of (1) at least 500 employees within a 30-day period, or (2) at least 50 employees when that number represents at least one-third of the company’s total full-time workforce. Id. A termination of operations occurs when the company voluntarily closes an entire facility, either permanently or temporarily. A transfer of operations involves moving a facility to another location.
If an employer conducts a mass layoff or a transfer or termination of operations that causes equivalent job loss, the NJ WARN Act requires it to provide a notification to each affected employee, along with severance pay “equal to one week of pay for each full year of employment.” Id. at § 34:21-2(b). The notification must state the number of employees losing jobs, an explanation of why the employer is undertaking these actions, a breakdown of the severance pay, statements of the employee’s legal rights, and information about comparable jobs available with the employer. Id. at § 34:21-3.
Employers that fail to provide the required notification may be liable to aggrieved employees for court costs, attorney’s fees, and compensatory damages. These damages are generally limited to the severance pay prescribed by the statute. Id. at § 34:21-6. The New Jersey Appellate Division has held that the requirements imposed by the NJ WARN Act apply to parent companies of an employer, as well as affiliated companies. DeRosa v. Accredited Home Lenders, 22 A.3d 27 (N.J. App. 2011). The court noted that the closure of a single facility could be a sign of the entire business’ failure, which would leave a laid-off employee with no recourse. It adopted the federal government’s position that “parent and affiliated corporations may incur federal WARN Act liability.” Id. at 37; see also 20 C.F.R. § 639.3(a)(2).
The skilled and experienced wrongful termination attorneys at the Resnick Law Group can help you with your employment dispute in New Jersey or New York. Contact us online, at 973-781-1204, or at (646) 867-7997 today to schedule a confidential consultation.
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