Under an amendment to the New York Worker Adjustment and Retraining Notification (“WARN”) Act, employers in New York state carrying out certain large layoffs or site closings will have to provide advance notice to a broader range of government entities. The amendment took effect on November 11, 2020 after being signed by New York Governor Andrew Cuomo. In the legislative memo accompanying the amendment, the State Assembly explained that notice to these additional governmental entities will forewarn them of potential loss of tax revenue as well as safety risks posed by suddenly-vacant properties.
Background on WARN Act
The New York Worker Adjustment and Retraining Notification Act, or “WARN” Act, requires private-industry employers with 50 or more employees to provide at least 90 days of advance notice to their employees and to government agencies if the employer intends to carry out a mass layoff, a site closure (also known as a “plant” closure), or before carrying out certain large reductions in employee hours or employee relocations. Generally, if the employer’s projected action will impact at least 25 employees (for example, that 25 employees may lose employment), the employer must be on guard for WARN Act implications and should consult with employment counsel regarding the WARN Act’s labyrinth of rules and procedures. Improperly calculating the number of affected employees, misjudging whether the WARN Act has been triggered, or even failing to deliver WARN notices to employees and government agencies properly, can trigger expensive penalties.
The New York WARN Act is the state’s counterpart to the Federal WARN Act. The Federal WARN Act is similar to the N.Y. WARN Act, though they differ in some respects. Among the Federal WARN Act’s chief differences: it covers employers with 100 or more employees, requires only 60 days of advance to employees and governmental agencies, and is generally triggered when an employer action will affect at least 50 employees. Employers covered by both the Federal and New York WARN Act must comply with both laws.
Amidst the ongoing economic reaction to the coronavirus pandemic, employers throughout the state have experienced WARN-triggering events such as mass layoffs unexpectedly lasting longer than 6 months or total site closures. The complexity of the N.Y. and Federal WARN Acts’ procedures, combined with the suddenness of the pandemic’s economic hit, makes WARN Act compliance a ripe area for inadvertent noncompliance.
Expanded List of Government Agencies Now Entitled to WARN Notices
Under the existing N.Y. WARN Act, employers experiencing a WARN-triggering event had to provide notice to:
- The affected employees, and/or their representatives,
- The N.Y. Department of Labor,
- The relevant local Workforce Investment Board.
That list is now larger with the amendment to the N.Y. WARN Act, Assembly Bill 10674-A. Under the amendment, employers covered by the N.Y. WARN Act will have to provide advance notice to the foregoing entities, along with:
- The chief elected official of the unit, or units, of local government in which the WARN-triggering event will occur,
- The chief elected official of the school districts in which the WARN-triggering event will occur
- Each “locality” that provides emergency services (police, EMS, firefighting, etc.) to the employment site that will experience the WARN-triggering event.
Steps for Businesses
With the pandemic’s economic effects still unfolding, businesses should pay close attention to developments to both the N.Y. and Federal WARN Acts. Business leaders and human resources professionals are well-served to keep the WARN Acts general requirements in mind when considering layoffs and closures, and should consult with experienced employment counsel to prevent accidental missteps during what is an already stressful time.
This alert does not purport to be a substitute for advice of counsel on specific matters.
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Harris Beach has offices throughout New York State, including Albany, Buffalo, Ithaca, Long Island, New York City, Rochester, Saratoga Springs, Syracuse and White Plains, as well as New Haven, Connecticut and Newark, New Jersey.