When an employer in New Jersey performs a large-scale layoff, closes a facility, or eliminates many jobs, the affected employees have certain rights. Regretfully, those rights do not grant them the right to remain employed or to be given preference for other roles within the organization. Companies are free to reorganize, downsize, or otherwise adapt their workforces in response to changing economic conditions.
However, employees have a legal claim to a certain period of notice before a plant closure or significant workforce reduction. Employees are entitled to damages if the employer fails to provide appropriate notice.
The Federal Worker Adjustment and Retraining Notification (WARN) Act protects these rights. Similar laws exist in nearly half of the states, including New Jersey. According to New Jersey law, layoffs must be announced in advance, and employers who fail to do so must pay severance.
The federal WARN Act and New Jersey law, as well as the rights of New Jersey employees, are briefly discussed in this article. See the articles on our Losing or Leaving Your Job page for additional details about your rights when you are laid off, including when you should get your last paycheck and how to keep your health benefits.
Which Companies Are Protected?
The federal and state laws have different coverage requirements.
Companies Served by WARN
The WARN Act mandates that larger employers must provide advance notice of impending mass layoffs or plant closures, leading to a specified number or percentage of employee job losses. To fall under the Act’s purview, employers must have a minimum of 100 full-time employees or 100 workers collectively clocking 4,000 hours or more weekly.
Full-time employment is defined as working a minimum of 20 hours weekly for at least six months within the preceding 12 months, relevant to the notification date specified by WARN.
This legislation aims to protect employees by ensuring they receive timely warnings about significant workforce changes, providing them with an opportunity to prepare for potential job loss or transition.
Employers Covered by New Jersey Law
Employers who have employed 100 people or more and have owned a business for at least three years are covered under New Jersey law.
Which Layoffs Are Covered?
Both federal and state laws do not apply to every layoff or plant closure.
Federal WARN Act
The Worker Adjustment and Retraining Notification (WARN) Act exclusively pertains to plant closings and mass layoffs. A plant closing involves the cessation of operations at a single employment site, affecting 50 or more full-time employees within a 30-day period.
An employment site is defined as a distinct geographical location where an employer conducts operations, including buildings or office suites. Even physically separate work areas may be considered a single site if they are close, share purposes, and have common staff and equipment.
A mass layoff, on the other hand, occurs when 500 or more full-time employees are affected at a single site, or for 50 to 499 full-time employees if they constitute at least 33% of the active workforce. The WARN Act also covers plant closings or mass layoffs occurring incrementally over 90 days to prevent evading notice requirements through staged layoffs.
New Jersey Law
New Jersey’s layoff law encompasses two key scenarios. Firstly, it applies to mass layoffs involving a substantial workforce impact. This includes situations where a minimum of 500 full-time employees are laid off or when at least 50 full-time employees, constituting at least one-third of the establishment’s full-time workforce, lose their jobs.
Secondly, the law also covers the termination or relocation of operations leading to job loss for a minimum of 50 full-time employees.
In both instances, the legislation is designed to address significant workforce disruptions and ensure appropriate measures are taken to protect employees affected by these sizable workforce changes in the state of New Jersey.
What Notice Is Required?
There are notice requirements under New Jersey law as well as WARN.
Required Notice
When a plant closing or layoff falls under the purview of WARN and/or New Jersey law, affected employees are entitled to 60 days’ notice of their impending termination. (Union members do not require individual notice; the employer will notify their bargaining representatives, who will then forward the information to the affected employees.)
Specific details regarding the anticipated layoffs must be included in the notice, such as whether they are anticipated to be temporary or permanent, when the layoffs are anticipated to start, when the employee will receive a letter of termination, and whether the employee will have bumping rights.
Exceptions Under WARN
The Worker Adjustment and Retraining Notification Act (WARN) provides guidelines for employers regarding notice periods for layoffs, with exceptions allowing for less than 60 days’ notice. Employers are not obligated to give notice for layoffs involving temporary or seasonal employees, layoffs resulting from completed temporary projects known to employees, or those caused by strikes or lockouts.
Exceptions to the 60-day notice rule include unforeseeable business circumstances, where the employer couldn’t have predicted the need for layoffs; faltering company, allowing a shorter notice if actively seeking financial solutions; and natural disasters, permitting reduced notice for layoffs resulting from such events. Employers must still provide as much notice as possible and explain why the full 60 days couldn’t be given.
Severance Under New Jersey Law
All full-time employees who lose their jobs are entitled to one week of severance pay for each year of employment if their employer fails to give notice at least sixty days in advance as required by law. Keep in mind that this benefit only becomes active if the employer fails to provide notice.
If Your Rights Have Been Violated
Speak with a knowledgeable New Jersey employment attorney if you think your rights have been infringed. WARN encourages attorneys to take on challenging cases by offering the possibility of winning attorney fees. Nonetheless, each employee’s access to damages is comparatively limited. As a result, a lawyer might suggest filing a class action lawsuit on behalf of all impacted employees or attempting to negotiate a settlement.