Both federal and New Jersey employment laws set restrictions on how and when employers may fire their employees, such as restrictions on discriminatory or retaliatory firings. Prior to a mass layoff of workers, many employers must provide advance notice. Their employees may be able to file suit if they fail to follow the law’s requirements. The COVID-19 pandemic brought an unprecedented number of layoffs and furloughs. We are nearing the six-month mark since the pandemic first hit this country. Courts have never ruled on a case that presents the particular circumstances we see right now. The New Jersey Legislature amended its law in early 2020 to provide additional remedies for workers, but then amended it again during the pandemic to exempt many layoffs from coverage by the law.
The Federal WARN Act
The Worker Adjustment and Retraining Notification (WARN) Act of 1988 requires employers with one hundred or more employees to notify employees before large layoffs or plant closures.
An employer must provide written notice to each “affected employee” or their representative, such as a labor union, at least sixty days before an event that will result in significant “employment loss.” The statute defines “employment loss” to include:
– Termination of employment that is neither voluntary nor for cause;
– A reduction in hours of over fifty percent for six months; or
– A layoff that continues for more than six months.
In the current situation, the WARN Act could apply to employers who furloughed fifty or more employees for more than six months, or who substantially reduced their hours.