Terminating and/or firing employees is an often dreaded task faced by employers in all industries and lay offs are no different. Unfortunately, at some point in the business life cycle, financial difficulties may mean a business owner needs to lay off employees – and do so in a manner that does not result in legal action by the disgruntled employee.
While it is not against California law for employers to lay-off their workers without any promise or consideration of rehire, there is a legal obligation for employers to give proper notice of lay-offs. Failure to do so could result in compensatory damages to employees.
Under federal law and state law, certain California employers are required to give advance notice of a plant closing or a lay off that will result in a certain percentage of its workers losing their jobs. The WARN Act (Worker Adjustment and Retraining Notification) is a federal labor law that aims to protect employees and their families in the event of a massive lay off or plant closing. California has its own version, often referred to as mini-WARN, which also requires disclosure.
Under WARN, employers are required to give notice to employees if the employer has at least 100 full time employees or 100 employees who work a combined total of 4,000 hours each week. Full time is defined as someone who works at least 20 hours each week and has worked for at least six of the last 12 months. Under this law, a plant closure for 500 or more full time employees or a lay off plan that will eliminate 1/3 of the employees will require notice to the workforce.
Under California law, employers are required to give notice if they own an industrial or commercial facility and they have at least 75 workers. Under state law, a massive lay off is defined as at least 50 workers who will be without work for a minimum of 30 days. If an industrial or commercial facility plans to relocate at least 100 miles away, they are also required to give notice.
Unless the employer meets an exception under federal or California state law, they must give 60 days’ notice. Failure to do so can mean that employees are eligible to file a claim for damages.
If your business is considering a lay off, speak with experienced business attorney Drew E. Pomerance before taking any action in order to avoid a potential lawsuit.