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You are Here: Home > Blog > Are there any Layoff Laws?

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Employee Rights and Related Matters

Are there any Layoff Laws?

Wednesday, November 17th, 2010

There are no “layoff laws” that regulate all to do with layoffs, because employment is presumed to be at will in the USA. However, employees are protected to a degree by a few laws that function as layoff laws of sorts.

The “main” layoff law, so to speak, is the federal Worker Adjustment and Retraining Notification Act (WARN Act), generally referred to as the “layoff notification law”.

The WARN Act requires most employers with 100 or more employees to give affected employees up to 60 days of advanced notice for mass layoffs or related plant closings lasting over six months. Which among WARN-covered employers must give notice depends on how many workers they lay off.

The WARN Act also requires covered employers to continue to pay employees and give them the benefits to which they are entitled throughout their layoff notice periods, even if the employers don’t require affected employees to show up for work while on notice.

Some states, such as California, have their own layoff laws that are similar to the federal WARN Act, which are generally referred to as “mini-WARN Acts”. In fact, a few states, such as New York and New Jersey, beefed up existing or enacted new mini-WARN Acts to deal with the record-level mass layoffs caused by the Great Recession.

Employees are protected by whichever layoff law at the federal or state level provides the most protection. Subsequently, employees have won lawsuits against covered employers who did not comply with the federal or state notice requirements. Such lawsuits are often class actions. Consult a lawyer about that.

Another federal layoff law of sorts, is the Consolidated Omnibus Budget Reconciliation Act (COBRA). It requires employers with 20 or more employees to allow eligible laid-off employees to continue their employer-provided health insurance coverage at group rates.

Some among the variety of laws that prohibit wrongful termination also function as layoff laws of sorts. For example, a discrimination law might come into play if, under the cover of a layoff, an employer has discharged a disproportionate number of workers with a certain characteristic, such as age or gender. Age discrimination lawsuits are the most common to arise from suspect layoffs.

Of course, state unemployment laws also function as layoff laws, in that they provide unemployment benefits to eligible laid-off employees and grant them the right to appeal a denial of benefits. The laws vary by state, as do the benefits they provide.

Other federal and state laws (or related regulations) might serve as layoff laws of sorts, such as those prohibiting employer retaliation and those requiring employers to issue final paychecks in a timely way.

Consult a lawyer for legal advice about so-called layoff laws.

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