How are layoffs supposed to be handled when someone buys my business? — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

How are layoffs supposed to be handled when someone buys my business?

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Q. Do I have to follow the WARN Act if someone buys my business?

A. The seller has to follow the Worker Adjustment and Retraining Notification (WARN) Act if the employer is covered under the WARN Act and the sale of the business results in a “plant closing” or “mass layoff.”  

Employers are covered by the WARN Act if they have 100 or more employees, not counting employees who have worked fewer than six months in the last 12 months and not counting employees who work an average of fewer than 20 hours a week.

“Plant closing” refers to the permanent or temporary shutdown of a single site of employment, or one or more facilities or operating units within a single site of employment, if the shutdown results in an employment loss during any 30-to-90-day period for 50 or more employees (excluding part-time employees).

“Mass layoffs” occur when at least 33% and 50 active, full-time employees at a single site of employment are laid off within a 30-to-90-day period, regardless of whether an entire department or unit is closed. A mass layoff also occurs when 500 or more full-time employees at a single site suffer an employment loss, regardless of whether those employees make up 33% or more of the workforce.   

If a sale by a covered employer results in a plant closing or mass layoff, the seller is responsible for providing 60 days’ notice if the covered plant closing or mass layoff occurs up to and including the date and time of the sale.  After the sale, the buyer is responsible for WARN notices.

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