As many have probably heard, Twitter was recently sued for purportedly not giving its employees sufficient advance notice of a mass layoff following Elon Musk’s recent purchase of the company. In early November, several former employees of Twitter brought a class-action lawsuit against Twitter claiming that the company violated the California Worker Adjustment and Retraining Notification Act or WARN Act when it laid off fifty percent (50%) of its workforce (3,700 employees) without the required sixty (60) day warning.
What is the WARN Act?
The California WARN Act or California Labor Code §§ 1400-1408, is a regulation that requires certain employers to provide workers with at least sixty (60) days advance notice (“warn notice”)
before the employer can conduct a mass layoff, a plant closure or a major relocation. Employers that fail to comply with this regulation by not providing the mandated notice are subject to liability and must provide the terminated employee with back pay and benefits for the period of the violation, or the amount of time by which the advance notice was less than 60 days.
Who is protected by the WARN Act?
The WARN Act applies only to employers who have employed at least seventy-five (75) employees in the preceding twelve (12) months and protects employees who are fired in connection with a mass layoff (a layoff of fifty (50) or more employees during any thirty (30) day period due to lack of work or lack of funds), a termination (plant closure), or the relocation of all or substantially all of a business’ operations to a new location at least one hundred (100) miles away. Further, the WARN Act protects only those California employees that have been employed by the employer for at least six (6) of the twelve (12) months preceding the date on which notification would be required
When is notice not required under the WARN Act?
There are limited circumstances where the 60 days advance notice is not required under the WARN Act. These include mass layoffs or terminations that occur due to a physical calamity, natural disaster or an act of war, or if the mass layoffs or terminations result from the conclusion or completion of a project (for example, the completion of a construction project). The WARN Act also does not apply to seasonal employees who were hired for seasonal or temporary work.
What if an employer violates the WARN Act?
If an employer fails to provide 60 days advance notice in connection with any one of these events, then employees who lose their job in connection with the event will have the right to sue the employer for damages. Such damages include back pay for the period of the WARN Act violation, at the average regular rate the employee received during his or her last three (3) years of employment and the value of benefits that the employee would have been entitled to during the period of the violation.