Bob Horton Offers Guidance on Potential Litigation Involving WARN Act Following COVID-19 Pandemic

June 1, 2020
Society for Human Resource Management (SHRM)

Bass, Berry & Sims attorney Bob Horton offered guidance on the Worker Adjustment and Retraining Notification (WARN) Act as it relates to changes in employment status for an article by the Society for Human Resource Management (SHRM) addressing potential litigation issues from the COVID-19 fallout.

The WARN Act requires most employers with more than 100 employees to provide a 60-day notice ahead of large-scale layoffs or the closing of operations. Bob shared that WARN Act claims require plaintiffs to show the following:

  • A facility closed and at least 50 full-time employees lost their jobs.
  • At least 500 full-time employees at a facility lost their jobs.
  • At least 50 full-time employees lost their jobs and the number of full-time employees at the facility losing their jobs exceeded one third of all employees at the facility.

Importantly because the pandemic has hit businesses quickly and made the 60-day notice more difficult to see through, the WARN Act permits employers to avoid the 60-day notice requirement in the event of “unforeseeable business circumstances” (although as much notice as possible must still be given). Interestingly, those employers who had WARN events connected with the pandemic early on will likely have far more success with arguing the “unforeseeable business circumstances” exception to their WARN notice obligation.

The full article, “Prepare for Wide Range of COVID-Related Lawsuits,” was published on May 27 by SHRM and is available online. More information on compliance when reducing workforce numbers is available in our recent HR Law Talk blog post titled “Workforce Reduction Options Amid COVID-19.”