Expansive NJ WARN Act Amendments on Mass Layoffs – Here to Stay
June 20, 2023
Types : Alerts
Employers should be aware that significant changes to the Millville Dallas Airmotive Plant Job Loss Notification Act (“NJ WARN”) took effect on April 10, 2023. The amendments broaden the definition of a mass layoff, create a mandatory severance pay requirement for employers, and increase notice requirements and related penalties. These amendments continue making the NJ WARN more burdensome than its federal counterpart, the Worker Adjustment Retraining and Notification Act of 1988 (the “WARN Act”).
The NJ WARN Act applies to all employers who have operated in New Jersey for more than three years and who employ 100 or more employees. Effective April 10, 2023, employers considering a mass layoff, termination of operations, or transfer of operations, should be aware of these critical NJ WARN Act changes:
- Reduction in force requirement: Employers must comply with the NJ WARN Act’s requirements if a layoff during any 30-day period results in the termination of 50 or more employees in New Jersey.
- Increased notice: Employers must provide 90 days’ notice to employees prior to any covered action, rather than 60 days’ notice, as previously required in New Jersey and currently under the federal WARN Act.
- Part-time employees: In calculating whether an employer has the 100 employees necessary to trigger the Act, part-time employees are now included.
- Mandatory severance pay, regardless of notice: Employers must provide “severance pay equal to one week of pay for each full year of employment” to all New Jersey employees subjected to mass layoff, termination of operations, or transfer of operations, regardless of whether the employer provided proper notice to the employee.
- Severance penalty: Employers who fail to provide the required advanced notice must pay four weeks additional severance pay, as well as the mandatory severance pay.
Employers should review the NJ WARN Act amendments when considering possible workforce restructuring. In addition to the Act now encompassing more employers, the amendments increase potential employer exposure from individual and class action suits brought by employees who believe their employer failed to follow any of the new requirements when restructuring.
If you have any further questions or would like more information, please reach out to Fiona Steele.