Worker Adjustment and Retraining Notification Act

The Federal Worker Adjustment and Retraining Notification Act (“WARN Act”) (29 U.S.C. §2101 et seq.) and the Illinois Worker Adjustment and Retraining Notification Act (820 ILCS 65/ et seq.) govern permanent layoffs caused by plant closings and reductions in the workforce.

The Illinois and Federal WARN Acts require employers to provide written notice at least 60 calendar days in advance of mass layoffs so that employees have adequate time to transition and seek alternative jobs or enter skills training programs if:

1. The business has 75 or more full-time workers under Illinois law (100 under federal law) excluding part-time employees; and
2. There is a mass layoff that does not result from a plant closing which results in an employment loss at a single site during any 30 day period of at least 33% of the total active workforce excluding part time employees and at (however, part-time workers are still entitled to receive WARN notice if there is one);

A “mass layoff” under Illinois law occurs when 25 or more full-time employees are laid off if they constitute one-third or more of the full-time employees at the site, or 250 or more full-time employees. A “mass layoff” under federal law occurs when 50 or more full-time employees are laid off if they constitute one-third or more of the full-time employees at the site, or 500 or more full-time employees.

WARN notice is also required if an employer has a series of small terminations that occur over a 90 day period, none of which individually would be covered under WARN, but which add up to numbers that would require WARN notice.

Employees who are terminated or laid off for more than 6 months or who have their hours reduced 50% or more in any 6-month period as a result of a mass layoff are also considered affected employees and are required to receive WARN notice.

WARN notice must be given to all affected employees and representatives of affected employees. It must include the following information:

1. Must be written in clear and specific language that employees can easily understand;
2. Must contain a statement as to whether the planned action is expected to be permanent or temporary and, if the entire plant is to be closed, a statement to that effect,
3. Must contain the expected date when the plant closing or mass layoff will commence and the expected date when the individual employee will be separated;
4. Must contain the name and telephone number of a company official to contact for further information;
5. Must be 60 days in advance of the exact date of a termination or layoff or may identify a two week (14 day) period during which terminations or layoffs will take place; and
6. May include additional information useful to the employees such as available dislocated worker assistance, and, if the planned action is expected to be temporary, the estimated duration, if known.

Additional notice is required when the date or schedule of dates of a planned plant closing or mass layoff is extended beyond the date or the ending date of any 14 day period announced in the original WARN notice.

WARN notice must be given to the Illinois Rapid Response Dislocated Worker Unit, the Illinois Department of Labor at its Springfield office, and the chief elected official of each municipal and county government within which the employment loss, relocation or mass layoff occurs is required.  It may also be helpful to provide notice to nearby local governments so that coordinated planning of services for those employees to be laid off may begin quickly. Said notice must contain the following information:

1. The name and address where the mass layoff or plant closing is to occur, along with the name and telephone number of a company contact person who can provide additional information;
2. An explanation of whether the employment loss will be temporary or permanent, and whether the entire plant is being closed;
3. The expected date of first job losses, along with a schedule of any further employment reductions;
4. The job titles of positions that will be affected and the number of affected employees in each job category; and
5. The name of each union/employee representative and the name and address of the chief elected officer of each union.

WARN notice must be given to the Union Representative. It must contain the following information:

1. The name and address where the mass layoff or plant closing is to occur, along with the name and telephone number of a company contact person who can provide additional information;
2. A statement as to whether the planned action is expected to be permanent or temporary and, if the entire plant is to be closed, a statement to that effect;
3. The expected date of the first separation and the anticipated schedule for making separations; and
4. The job titles of positions to be affected and the number of affected employees in each job classification.

In the State of Illinois, Section 15 of the Business Economic Support Act requires that any business or industry required to provide notice under WARN and receiving State or local economic development incentives for doing or continuing to do business in this State, in addition to the notice required under WARN, shall also provide at the same time a copy of that notice to the Governor, the Speaker and Minority Leader of the House of Representatives, the President and Minority Leader of the Senate, and the Mayor of each municipality where the private entity has locations in this state.

Service of Notice. An employer may use any reasonable method of delivery designed to ensure receipt of the written notice at least 60 days before separation; however, preprinted notices regularly included in each employee’s paycheck or pay envelope and verbal notices do not meet WARN act requirements.

Penalties. An employer who violates WARN is liable to each affected employee for an amount equal to back pay and benefits for the period of violation, up to 60 days, which may be reduced by any wages the employer pays over the notice period.  An employer who fails to provide notice as required to a unit of local government is subject to a civil penalty not to exceed $500 for each day of violation.

The Illinois WARN Act gives the director of the Illinois Department of Labor the power to make rules providing for administrative hearings and the power to examine the records of an employer to determine whether a violation of the Illinois Act occurred.  Under the federal Act, compliance is not monitored by an administrative agency; rather, affected employees or their representatives may file civil lawsuits in federal court.

Illinois Worker Adjustment and Retraining Notification Act

Federal Worker Adjustment and Retraining Notification Act