Employer’s Failure to WARN Employees about Layoffs May Not Be Automatically Excused By COVID-19
By Paula Jackson
February 1, 2021
Lately, many businesses are faced with the tough decision of whether to down-size quickly to stay afloat during the COVID-19 pandemic. Due to plants closures or mass layoffs, companies subject to the Worker Adjustment and Retraining Notification Act (“WARN” Act) may be tempted to skip or skimp on the required sixty-day written notices about closures or layoffs to employees. However, recent guidance indicates that employers may not be able to rely on the pandemic as a viable defense to the required warnings, so they should still issue notices sixty days before layoffs or at least as quickly as possible under the circumstances.
First, one federal judge indicated that the “natural disaster” defense that excuses employers from providing notice only applies if the layoff was the direct result of a natural disaster, such as a flood that directly destroyed a workplace overnight. This defense would not be triggered by COVID-19, where the virus did not directly cause the business closures but only indirectly caused businesses to shut down due to revenue loss when customers stopped purchasing its products or services due to concerns over the spread of the virus.
Second, the other potentially applicable defense, “unforeseeable business consequences,” will only protect businesses due to COVID-19 if they gave as much notice as possible about the layoffs. This is a factual issue unique to each employer, which will likely consider the company’s perceived impact of the virus on its business, the time frame of that notice, and its financial ability to stay afloat while giving employees as much notice as possible of the closure. It is always best to seek your Labor and Employment Attorneys’ counsel when making decisions regarding mass layoffs.
 29 U.S.C. § 2102(a)-(b); 20 C.F.R. § 639.9. The text of the federal WARN Act can be found at: https://www.govinfo.gov/content/pkg/USCODE-2009-title29/pdf/USCODE-2009-title29-chap23-sec2102.pdf. The regulations can be found at https://www.ecfr.gov/cgi-bin/text-idx?SID=d1d567e33c65f9654e8a3e9480dcbb25&mc=true&tpl=/ecfrbrowse/Title20/20cfr639_main_02.tpl. WARN Act notices are typically required from employers with over 100 employees if at least 50 full-time employees are laid off or terminated within 30 days, but these notice requirements are also triggered if either 500 employees or 33% of the full-time workforce is laid off. 20 C.F.R. § 639.3(a)-(c). Additionally, states may have their own acts similar to the WARN Act. Benson v. Enterprise Leasing Co. of Florida, LLC, Case No. 6:20-cv-00891, Doc. No. 61 at 10-11 (M.D. Fl. Jan. 4, 2021) (citing 29 U.S.C. § 2102(b)(2)(B); 29 C.F.R. § 639.9(c)(2)).  Id. at 10-11.  Id. at 12 (citing 29 U.S.C. § 2102(b)(2)(A), (b)(3); 20 C.F.R. § 639.9(b), (c)(4)).