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Employee Rights When Facing Mass Layoffs or Reductions in Force

No employer wants to lay off large numbers of employees as it is typically a symptom of an economic downturn. Unfortunately, layoffs and reductions in force are a part of doing business as they are one tool of many that companies can use to stay viable in a down market. Making such a decision does not mean that the employees who are most negatively affected do not have rights. Employers must ensure that they are following local employment laws designed to provide a balance between employee rights and an employer’s bottom line.

California WARN Act

The Worker Adjustment and Retraining Notification (WARN) law requires that any employer that is planning to announce mass layoffs or reductions in force must provide employees with 60 days’ notice prior to the order taking effect. The employer must also report the decision to the State’s Employment Development Department. Failure to comply can lead to liability under the act for back pay and benefits for the 60 day period that they should have been on notice. The law was designed to allow employees sufficient time to find alternative employment, obtain training and make arrangements for their potential change in financial status. While there is a federal counterpart (Federal WARN), the two statutes differ and employees should be aware of their rights under each.

The Federal WARN act applies to any employer with 100 or more full-time employees. The California law provides protection to a greater number of employees as it applies to employers with 75 or more employees, regardless of whether they are part-time or full-time. In addition to the penalties of back pay and benefits mentioned previously, the California WARN act also includes the possible imposition of $500 a day for each day the employer is in violation. 


Employees should know that the California act does not apply to project work (i.e. motion picture industry, construction, drilling, logging, and mining industries, or seasonal employment) if the employees were hired knowing that the employment was limited to the duration of the project or season. Neither the federal or state law applies if a plant or business closure is due to unforeseeable circumstances such as a natural disaster.

Facing a Layoff?

There are many things that may go through your mind if you have been laid off by your employer. You may be too busy trying to find other employment or making critical financial decisions to think about whether your employer complied with the state and federal laws applicable to layoffs. Unfortunately, too many employers find ways to skirt employment laws, especially when faced with an economic downturn. Laws have been created to protect employees from unscrupulous decisions such as these, and the professionals at Garcia & Gurney can help.  Call today and speak with one of our attorneys about your case and find options for holding your employer liable for their unlawful choice. Layoffs and mass reductions in force may sometimes be necessary, but that does not mean employees are unprotected.

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