If you work for a company that employs at least 100 people, and you lose your job because of a plant closing or a “mass layoff” (one third of the workforce or a big enough number of people), you could be entitled to up to 60 days’ notice or 60 days’ pay in lieu of notice. That’s what’s required under the federal Worker Adjustment and Retraining Notification (“WARN”) Act. Seems pretty simple and straightforward, but as with most laws, the devil can be in the details, and if the plant closing or layoff was in response to COVID-19, your employer may try to avoid the notice or severance pay requirement by invoking either a “natural disaster,” or an “unforeseeable business circumstance” exception.
Exceptions Not an Automatic “Out” for Employers
Fortunately for laid off employees, a recent ruling from a Federal District Court judge in Florida makes clear those exceptions do not provide an automatic “out” for employers seeking to avoid their WARN Act obligations. The court first found that the pandemic, while a disaster in many ways, does not fall within the law’s natural disaster exception at all. “This isn’t a situation where, for example, a factory was destroyed overnight by a massive flood – that would be a ‘direct result’ of a natural disaster. This is an indirect result – more akin to a factory that closes after nearby flooding depressed the local economy.” Thus, “the natural disaster defense doesn’t apply; rather, the ‘unforeseeable business circumstances exception’ is the proper focus.”
The Burden of Proof on An Employer
Moreover, though no one would argue that the pandemic was foreseeable, the second exception does not automatically apply. Rather, a company seeking to avoid severance payments under the unforeseeable business circumstance exception would have to explain in detail just how it was affected by COVID-19, and why no notice or severance was provided to laid off employees. Companies that were planning layoffs even before the pandemic could be hard pressed to justify a sudden rush to lay people off without notice or severance just because it seems to provide a ready excuse.
Receive Guidance from An Employment Law Attorney
People laid off since the disease hit the U.S. early last year, and who received no warning or severance, should review what happened, and if they were part of a plant closing or a large group of terminated employees, they should consult with a lawyer to see if they have a potential WARN Act claim.