WARN Act Lawyers

What Is the WARN Act, and Why Does It Matter?

The Worker Adjustment and Retraining Notification (WARN) Act is a federal law passed in 1988 that requires covered employers to provide 60 days' advance notice before mass layoffs or plant closings. The law aims to protect workers and communities from the devastating effects of unemployment.

Here's what makes WARN Act violations so damaging:

• No time for preparation: Families lose health insurance, income, and basic financial security overnight.
• Lost opportunity: Workers have less time to look for new employment.
• Employer advantage: Companies save money while workers absorb the cost.
• Widespread impact: Mass layoffs affect entire communities, not just individual employees.

The WARN Act isn't a suggestion; it's federal law with real penalties. Employers who violate it owe workers the wages and benefits they would have earned during those missing 60 days of notice.

Who Must Follow WARN Act Requirements?

The WARN Act applies to these employers:

• Organizations with 100 or more full-time employees.
• Organizations with 100 or more full-time and part-time employees who collectively work at least 4,000 hours per week.

The law applies to mass layoffs under the following circumstances:

• An employer lays off 50 to 499 employees, representing at least 33% of the employer’s workforce.
• An employer lays off 500 or more employees, regardless of the percentage of the workforce.

It also applies to plant closings, which occur when:

• An employer permanently shuts down a single facility or worksite, leading to job losses for 50 or more full-time employees.
• An employer temporarily shuts down a single facility or worksite, leading to job losses of at least six months for 50 or more full-time employees.

Employers can't sidestep the WARN Act by spreading layoffs across multiple weeks. If the company lays off the minimum number of workers within any 30-day period, it must follow the act’s notice requirements.

What Kinds of Employees Qualify Under the WARN Act?

The following employees must be notified of a layoff or plant closing covered under the WARN Act:

• Full-time hourly workers
• Part-time hourly workers
• Salaried managers and supervisors

Some employees, however, are not covered:

• Those participating in a strike or lockout.
• Those who are offered reassignment to similar jobs within reasonable commuting distance.
• Those who were hired on a temporary basis, if that fact was clearly communicated at the time of hire.
• Those who were hired for a specific project, if that fact was communicated at the time of hire.

Finally, if a job loss will last for less than six months, it does not fall under the WARN Act.

What Notice Must Employers Provide?

Employers must give written notice 60 days before the layoff to:

• Affected employees or their union representatives
• State dislocated worker units (usually the state labor department)
• Local government officials where the layoff occurs

The notice must include this information:

• Expected date of the layoff
• Whether the action is permanent or temporary
• Job titles and the number of affected employees
• Name and contact information for company officials

Email notices, verbal warnings, and rumors don't count. The WARN Act requires formal written notice with specific information, delivered to specific recipients, at least 60 days in advance of the action.

Limited Exceptions to WARN Act Requirements

Many employers try to avoid paying WARN Act damages, but exceptions are narrow and rarely apply. Courts carefully scrutinize employers who claim the following exceptions.

Unforeseeable Business Circumstances

Under this exception, the employer must have experienced sudden, dramatic, and unexpected changes outside of its control. The following circumstances do not apply:

• Recessions
• Declining sales
• Competitive pressures

Examples of unforeseeable business circumstances include the bankruptcy of a major client or the unexpected cancellation of a government contract.

Faltering Company

This exception can apply to plant closings, but not to mass layoffs. To qualify, the employer must be actively seeking capital to avoid shutdown. This might involve:

• Seeking loans or other forms of financing
• Seeking refinancing for existing loans
• Issuing stocks or bonds to raise capital
• Actively pursuing new clients to increase revenue

This exception will not apply if the company is only experiencing general financial difficulties.

Natural Disasters

A natural disaster exception may be granted to employers affected by these events:

• Earthquakes
• Floods
• Droughts
• Tsunamis
• Tornadoes, hurricanes, derechos, and other powerful storms

Even when exceptions apply, employers must still give as much notice as possible under the circumstances.

Your Rights and Potential Damages Under the WARN Act

If your employer violated the WARN Act, you're entitled to damages.

A judge may order back pay in the following form:

• Up to 60 days of wages for the period you should have received notice
• Calculated using your regular rate of pay and normal work schedule
• Including overtime if you regularly worked overtime hours

Benefits like the following may be included in your damages:

• Health insurance subsidies for up to 60 days
• Pension contributions the employer would have made
• Other fringe benefits you were receiving

Additionally, you don’t have to worry about the costs of legal representation:

• Winning employees recover reasonable attorney fees.
• Most WARN Act attorneys do not charge fees unless they win their client’s case.

The employer will also owe a fine to the government of $500 per day per employee. This fine is meant to encourage compliance and punish violations.

Example: Suppose that you worked at a manufacturing facility, where you earned $25 per hour working 40 hours per week. Your employer closed the plant abruptly in violation of the WARN Act, and you lost your job with zero notice. In your WARN Act lawsuit, you seek $8,000 in back pay plus the value of 60 days of health insurance and other benefits. You can also ask the company to pay your attorney’s fees.

Federal WARN Act vs. State Laws

Several states have their own laws similar to the WARN Act with enhanced protections. Here are some examples:

• California: Covers employers with 75 or more employees (vs. 100 under federal law); does not have an "unforeseeable circumstances" exception.
• Illinois: Covers employers with 75 or more full-time employees; in some cases, may apply to layoffs of just 25 employees.
• New York: Requires 90 days’ notice (vs. 60 under federal law), covers employers with 50 or more employees, and levies additional fines.
• Iowa: Requires 30 days’ notice if at least 25 employees will lose their jobs due to a plant closure or mass layoff, regardless of company size.

You may be entitled to damages under both federal and state law. Our attorneys analyze which laws apply to pursue full financial recovery.

WARN Act Violations During Bankruptcy

Many WARN Act violations occur when companies file for bankruptcy protection, but bankruptcy doesn't eliminate their legal obligations to workers:

• WARN Act damages receive administrative expense priority in bankruptcy.
• Employees get paid ahead of most other creditors.
• Bankruptcy courts can't discharge WARN Act obligations.

The Supreme Court has ruled that WARN Act claims survive bankruptcy.

Why CohenMalad's Trial-Ready Approach Gets Better Results

While some firms may process WARN Act cases through template settlements, we prepare every case for trial, and employers know this.

Consider our track record:

• $66.5 million medical malpractice verdict
• $55 million settlement
• 55+ years of litigation experience
• Federal court admissions nationwide

Here’s what trial-ready means:

• Motion practice victories that eliminate employer defenses
• Discovery battles that uncover hidden company documents
• Settlement negotiations backed by litigation strength, not empty threats
• Actual jury trial experience, when settlement offers aren't adequate

Our reputation for aggressive litigation means we negotiate from a position of strength. Employers may settle WARN Act cases for more money when they know we're prepared to take them to court.

Common Employer Defenses We've Defeated

Employers use predictable defenses to avoid WARN Act liability. We know these arguments and how to beat them.

“We Didn't Know About the Layoffs”

A company may claim that layoffs were the result of a last-minute decision, but internal documents usually show months of planning. We force discovery of board minutes, budget projections, and executive communications that prove advance knowledge.

“It's Not Really a Mass Layoff”

Companies may manipulate numbers by claiming that some employees quit, were fired for cause, or worked at different locations. We analyze payroll records and workforce data to prove actual layoff numbers.

“There Were Unforeseeable Business Circumstances”

Many employers claim this exception, but the definition is much narrower than it seems. We examine financial records, industry conditions, and company communications to show that layoffs were foreseeable and planned.

“We Gave Adequate Notice”

Companies may point to informal warnings, information passed down through supervisors, or general announcements as evidence of notice. These don’t count. We prove the company’s failure to deliver the right information to specific recipients.

How Your WARN Act Case Works

When you leave your case in our hands, here’s what to expect:

1. Free case evaluation: We review your layoff circumstances to determine whether you have a valid WARN Act claim.
2. Investigation: We gather employment records, company documents, and other evidence of WARN Act violations to build your case.
3. Filing your lawsuit: We file a comprehensive complaint in federal court detailing your employer's WARN Act violations and demanding full damages.
4. Aggressive litigation: We fight for discovery of company documents, refute employer motions, and build trial-ready cases that force better settlement offers.
5. Recovery: We negotiate aggressively for a fair settlement or take your case to trial.

At CohenMalad, LLP, you pay nothing unless we win. We advance all case costs and only collect fees when you recover money.

Time Limits for WARN Act Claims

WARN Act lawsuits must be filed within specific time limits that vary by jurisdiction. Missing these deadlines means losing your right to compensation forever. Since the original federal law did not include a statute of limitations, courts rely on state-level deadlines for similar laws.

Don't wait to find out whether you still have time. WARN Act cases require an investigation of company records that may be destroyed or lost. Call us immediately for a free evaluation of your case and filing deadlines.