California WARN Act (2023)

California’s Governor, Gavin Newsom, has issued an Executive Order to suspend the state’s WARN Act until the end of the COVID-19 emergency. This means that employers will be permitted to lay off employees in large numbers and shut down work sites without providing prior written notice that would otherwise be required under the WARN Act.

It’s important to note that the Order does not completely excuse employers from following California law. To lay off employees or shut down work sites without liability, employers must be able to establish a causal connection between their layoffs or shut down and COVID-19. This means that the exemption would not apply to employers who were already planning layoffs or shutdowns before the COVID-19 emergency.

Further, employers must:

• Give as much paid notice as possible, and explain in writing why proper or full notice was not given.
• Notify employees if they are eligible for unemployment insurance benefits.
• Provide the requisite written notices to the impacted employees, as well as state and local governments.

We will continue to update you as more news comes out about COVID-19 and your employee rights. Speak with a lawyer immediately if you feel you have been laid off unfairly, or your employer does not meet the COVID-19 exception.

California’s WARN Act defines a “mass layoff” as a layoff of 50 or more employees in a 30-day period. The California WARN Act also covers workers who suffer a layoff due to a business stopping or suspending its operations or relocating to a location more than 100 miles away.

California requires a WARN Notice before a mass layoff

 

(1) Are temporary or part-time workers covered by the California WARN Act?

Part-time contract workers or temps are given the same protections under the California WARN Act as a full-time employee if they’ve worked there at least six months. Part-time employees and temps also count towards the 50 workers required for a “mass layoff.”

(2) When does the 60-day clock start ticking?

The California WARN Act requires that employers give 60-days’ notice of mass layoff, and the 60-day clock counts backwards from the first worker laid off.

For example: Big Box Retail Chain Inc. decides to shut down its California operations. It lays off 10 workers on July 1, 20 workers on August 1, and 20 workers on September 1. The California WARN Act requires that notice of a mass layoff be given on May 1, two months prior to the first set of layoffs on July 1.

Businesses sometimes close down with no advance warning, but 60-days’ notice is often required in California

(3) What are the differences between the California and federal WARN Acts?

Generally, California labor law is more protective of worker rights than federal law. The WARN Act is no exception. The federal WARN Act defines a “mass layoff” as being at least one-third of the company’s total workforce, or at least 500 employees. California requires only 50. In addition, companies can get an exemption from the federal WARN Act if the company shows that the mass layoffs were due to unforeseeable business circumstances. California has no such exemption.

(4) What payoff can California employees get if there was no notice of a layoff?

The California WARN Act allows employees to recover up to 60-day’s pay and benefits. If an employee lost health insurance benefits due to the layoff, they can make their employer pay for health care expenses they incurred during that 60-day period.

(5) Does a mandatory leave of absence or furlough require 60-days’ notice under the California WARN Act?

California courts have decided that a furlough of 50 or more workers within one month is a “mass layoff’ under the California WARN Act. The same is not true under federal labor law.

(6) Are seasonal workers who are laid off after the busy season (such as Christmas) entitled to protection under the California WARN Act?

The California courts have interpreted the WARN Act as applying to seasonal workers if more than 50 are laid off during a 30-day period.

For example: Big Box Retail Chain Inc. hires 50 employees in its California stores for the busy Christmas season. When the Christmas season ends, Big Box lays off all 50 workers. Even if Big Box plans to re-hire the workers next Christmas season, the company is required to give 60-days’ advance notice before the seasonal layoff.

You speak to an employment attorney because you may be entitled to 60 days of wages and benefits, which you could recover through a class action lawsuit. Alternatively, you can report the violation to the California labor department.

Our California employment attorneys – with over 50 years of collective experience litigating under California employment law – know how to fight for employees’ rights and get them the money they deserve. We’ve recovered tens of millions of dollars for California employees and represent individuals as well as class actions in virtually every area of California employment and labor laws: California overtime law, off the clock violations in CA, breach of contract disputes, California independent contractor law, sexual harassment, employee misclassification, discrimination, as well as mass layoffs in violation of the California WARN Act. Our California employment lawyers are repeatedly recognized for their expertise litigating in California. Founding partner Eric Gibbs has been selected as one of the Top Plaintiff Lawyers in California. And seventeen of the firm’s attorneys were selected as Northern California Super Lawyers and Rising Stars, a distinction received by less than 5% of attorneys in Northern California.

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