Plant closings: You must give 60 days’ notice — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily
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Plant closings: You must give 60 days’ notice

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The 9th Circuit Court of Appeals, which covers California employers, has issued a strongly worded opinion chastising an employer for trying to dodge liability for not giving 60 days’ notice that it would close a facility, as required by the federal Worker Adjustment and Retraining Notification (WARN) Act.

Recent case: Todd Collins sued Gee West Seattle after the company gave employees about two weeks’ notice that they would be losing their jobs when the plant shut down. At the time, the plant employed 150 workers. By the last day of operations, only 30 employees remained.

Collins’ lawsuit argued that employees were due wages for 60 days because WARN requires 60 days’ notice before a plant shutdown in which 50 or more employees will lose their jobs. Gee West Seattle argued that because only 30 employees were left on closing day, it wasn’t liable.

The trial court agreed, but Collins appealed. The 9th Circuit Court of Appeals reversed the decision. It said that if the company’s argument prevailed, it would render WARN ineffective. WARN’s purpose is to warn employees that they are about to lose their livelihoods. Therefore, it doesn’t make any sense to reward employers that don’t give adequate notice and allow them to benefit when employees walk out when they hear the news.

Instead, employers have to tally the number of employees who will be affected by the proposed closure on the day the closure is announced. If they number greater than 50, then the company owes them 60 days’ notice—and wages for that time period—whether they remain on the job until the day the plant closes or quit before then. (Collins v. Gee West Seattle, No. 09-36110, 9th Cir., 2011)

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