WARN Act Temporary Layoff and Temporary Furlough
Question presented:
If I am considering a temporary layoff or furlough, do I need to provide workers with a notice under the WARN Act?
A WARN Act notice must be given when there is an employment loss, as defined under the Act. A temporary layoff or furlough that lasts longer than 6 months is considered an employment loss.
A temporary layoff or furlough without notice that is initially expected to last six months or less but later is extended beyond 6 months may violate the Act unless:
- The extension is due to business circumstances (includingunforeseeable changes in price or cost) not reasonably foreseeable at the time of the initial layoff; and
- Notice is given when it becomes reasonably foreseeable that the extension is required.
This means that an employer who previously announced and carried out a short-term layoff (6 months or less) and later extends the layoff or furlough beyond 6 months due to business circumstances not reasonably foreseeable at the time of the initial layoff is required to give notice at the time it becomes reasonably foreseeable that the extension is required.
A layoff extending beyond 6 months for any other reason is treated as an employment loss from the date the layoff or furlough starts. The WARN Act is enforced by private legal action in the U.S. District Court for any district in which the violation is alleged to have occurred or in which the employer transacts business. Thus an employer may need to prove that it could not foresee the circumstances if a WARN Act action is brought.
Any dispute regarding the interpretation of the WARN Act including its foreseeability will be determined on a case-by-case basis in such a court proceeding. The role of the U.S. Department of Labor is limited to providing guidance and information about the WARN Act; such guidance is not binding on courts and does not replace the advice of an attorney