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New Jersey Warns Us to Watch for Mini-WARNs

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We are all familiar with the federal WARN Act, which requires that employers give defined notices to employees ahead of certain layoffs or plant closings, but it is more difficult for employers to keep abreast of the ever-changing landscape of “Mini-WARN Acts” (the aptly nicknamed state laws that imitate the notice requirements of the WARN Act at the state level). Just last week, for example, New Jersey enacted significant amendments to its own Mini-WARN statute. New Jersey’s amendments go into effect July 19, 2020.

The new version of the New Jersey law greatly expands employers’ notice requirements. Most notably, employers will be required to count employee terminations (including part-time employees) occurring anywhere in the state, rather than just at a single site of employment, when checking whether they have met the 50-termination notice threshold. This new requirement might surprise employers who haven’t had to think about WARN notices because their workforces are spread out to the point that they have fewer than 50 employees located at any single site.

Additionally, the New Jersey law will mandate severance payments to terminated employees. Each terminated employee will be entitled to one week of severance for each year of service they have under their belt. This severance is increased by an additional four weeks’ pay if less than full notice of the layoff is given, which under the amended law will be a 90-day notice, rather than the 60-day notice required by the federal WARN Act.

The variations above all differ meaningfully from the requirements of the federal WARN act, and such variations from federal law are not uncommon in states where Mini-WARN Acts have been enacted. Employers, including employers operating outside of these states, should not assume that compliance with federal law in the area of WARN notices guarantees compliance with state law in the same area.

Employers should view New Jersey’s amended Mini-WARN as a helpful reminder that state-level requirements related to layoff notices are continually changing. If an employer is planning workforce reductions and they have not recently taken a look at potentially applicable Mini-WARN Acts, it would be in their interest to refresh their knowledge as soon as possible. Failure to do so well before a planned workforce reduction can lead either to delays in restructuring or to potentially significant liability.

This information is provided by Vinson & Elkins LLP for educational and informational purposes only and is not intended, nor should it be construed, as legal advice.