Overview: When employers have no choice but to layoff significant portions of their workforce, they must be careful to comply with federal and state law. Specifically, the federal Worker Adjustment and Retraining Notification (WARN) Act covers certain employers depending on their size and obligates certain employers (depending on the scope or circumstances of their planned action) to notify employees identified for termination in advance. Some states impose more severe restrictions on employers engaging in layoffs or reduction in forces and employers in those states are bound to comply with both their state's version of the WARN Act and the WARN Act itself.
HR plays an important role in the process of determining whether to proceed with a layoff or reduction in force. Specifically, it must help cultivate performance-related metrics to identify employees for termination, assess any post-termination risks for the employer, manage organizational exit and maintain communication with remaining and outgoing employees, notify the employees to be terminated and finally, work with the remaining workforce to maintain productivity and morale.
Trends: WARN Act terminations which require notification are somewhat cyclical in that they mirror the strength of the economy and may be more frequent during political election and changeover cycles. A periodic review of layoff or reduction in force policies by HR - taking recent developments and changes in the law into consideration - can be extremely helpful in limiting post-event risk to the employer.
It is also important for HR professionals to familiarize themselves with WARN Act legislation to ascertain what types of claims against employers are typically successful. This way, HR can identify problematic areas of its WARN Act protocol before they become costly for the employer.
Author: Michael Jacobson, JD, Legal Editor
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In-depth review of the spectrum of New York employment law requirements HR must follow with respect to involuntary terminations.
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In-depth review of the spectrum of federal legal requirements HR must follow when terminating an employee.
If Congress and the White House do not reach a deal on the sequestration,employers with federal contracts should be prepared to take immediate action to deal with drastic cuts in government spending that will result. Federal contractors should anticipate how the sequestration will directly affect their workplace with respect to complying with Worker Adjustment and Retraining Notification (WARN) Act, wage and hour requirements, benefits and immigration status as well as unions and collective bargaining agreement issues. Employers should also expect possible lawsuits from workers laid off due to spending cuts.
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In-depth review of the spectrum of California employment law requirements HR must follow with respect to involuntary terminations.
An employer may use this policy to convey the purpose for and importance of conducting exit interviews with employees departing the organization. Given that employers may collect valuable, candid information regarding employment practices from outgoing employees and may also identify post-termination risks such as lawsuits, employers are strongly encouraged to conduct exit interviews with all willing, outgoing employees. This policy can be used to put current employees on notice of the employer's intention to conduct such interviews and what the employer intends to do with the information it gathers.
Employers need to do everything they can to minimize claims by employees and the government. This section assists HR professionals in implementing proper policies and procedures, and understanding where the greatest risks lay and what the federal government's major enforcement initiatives are.
HR guidance on layoffs, reductions in force, compliance with the federal Worker Adjustment and Retraining Notification (WARN) Act, and the importance of understanding corresponding or heightened WARN Act requirements based on state law.
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