The Government Has Required My Employer In New Jersey To Close Temporarily Because Of COVID-19 Or Another Pandemic. Nonetheless, Must My Employer Pay Me My Hourly Rate?
If the government requires your employer in New Jersey to close temporarily because of COVID-19 or because of another pandemic, your employer may be required to pay, to you, your hourly rate. Whether your employer must pay, to you, your hourly rate during such a shutdown depends on whether the shutdown falls within the terms of the federal WARN Act.
By contrast, if the government requires your employer in New Jersey to close temporarily because of COVID-19, the New Jersey WARN Act does not require your employer to pay, to you, your hourly rate.
Federal WARN
The federal Worker Adjustment and Retraining Notification Act of 1988 (the “federal WARN Act,” the “WARN Act,” “federal WARN,” or “WARN”) offers protection to workers, their families and communities by requiring employers to provide notice 60 days before covered plant closings and covered mass layoffs. An employer who violates the federal WARN provisions by ordering a plant closing or a mass layoff without providing appropriate notice is liable to each aggrieved employee for an amount including back pay and benefits for the period of violation, up to 60 days.
In general, employers are covered by WARN if they have 100 or more employees, not including employees who have worked less than six months in the last 12 months and not including employees who work an average of less than 20 hours per week.
Employees entitled to notice under WARN include hourly and salaried workers as well as managerial and supervisory employees.
Among the events that triggers notice under WARN is a plant closing. A covered employer must give notice if an employment site, or one or more facilities or operating units within an employment site, will be shut down, and the shutdown will result in an “employment loss” for 50 or more employees during any 30-day period.
The term “employment loss” means, among other things:
- An employment termination, other than a discharge for cause, voluntary departure, or retirement; or
- a layoff exceeding six months.
With three exceptions, notice must be time to reach the required parties at least 60 days before a closing or a layoff.
The exception to 60-day notice, that is relevant to COVID-19 or another pandemic, is unforeseeable business circumstances. This exception applies to closings and layoffs that are caused by business circumstances that were not reasonably foreseeable at the time notice otherwise would have been required.
An important indicator of a business circumstance that is not reasonably foreseeable is that the circumstance is caused by some sudden, dramatic, and unexpected action or condition outside the employer’s control. A government ordered closing of an employment site that occurs without advance notice may be an unforeseeable business circumstance.
If an employer provides less than 60 days advance notice of a closing or a layoff and relies on, among other independent exceptions, the unforeseeable business circumstances exception, the employer bears the burden of proving that the conditions for the exception have been satisfied. Further, the employer must give as much notice as is practicable.
Furloughs (Temporary Layoffs). Generally, furloughs (that is, temporary layoffs) of less than six months do not trigger the federal WARN Act. That said, there are some exceptions and the size and length of the layoffs matter.
New Jersey WARN
Under New Jersey’s Millville Dallas Airmotive Plant Job Loss Act (“New Jersey WARN”), employers in New Jersey with 100 or more full-time employees must provide employees with at least 60 days advance notice in the event of a covered “termination of operations” or “mass layoff.” An employer who fails to provide the required 60 days notice must pay its employees severance pay equal to one week of pay for each full year of employment.
However, on April 14, 2020 and retroactive to March 9, 2020, New Jersey amended the New Jersey WARN Act’s definition of “mass layoff” to exclude reductions in force made necessary by “national emergencies.” As a result, terminations of operations and mass layoffs resulting from the COVID-19 pandemic (a national emergency) do not trigger the notice requirements of the New Jersey WARN.
In addition, these April 14, 2020 amendments to New Jersey WARN delay — until 90 days after the expiration of the COVID-19 pandemic-related New Jersey Executive Order 103 signed by New Jersey Governor Phil Murphy on March 9, 2020 – the effective date of amendments to New Jersey WARN enacted January 21, 2020. In turn, these January 21, 2020 amendments to New Jersey WARN, which were originally scheduled to take effect on July 19, 2020, will include guaranteed severance packages for downsized workers affected by covered mass layoffs, and will lengthen the minimum notice period from 60 days to 90 days. The impetus for these now-delayed, January 21, 2020 amendments to New Jersey WARN is, in part, the closing of several major New Jersey-based companies.
A Given Employer’s Reduction In Force Brought On By COVID-19 May, Or May Not, Constitute An Unforeseeable Business Circumstance Under The Federal WARN Act
Whether an employer’s reduction in force prompted by COVID-19 qualifies as an “unforeseeable business circumstance” under the federal WARN Act is a fact-specific inquiry, and depends upon the actions of the employer relative to that of others in its market. Employers may be affected by COVID-19 differently. Court cases illustrate, however, that no employer is held to the standard of hindsight when evaluating whether a business circumstance is unforeseeable.
If you are an executive or a professional in New Jersey and you believe that you have been wrongfully terminated, that you’ve been denied salary, bonuses, commissions, or other wages that are owed to you, or that your employer has failed or refused to reasonably accommodate your disability, call New Jersey Employment Attorney David S. Rich at (201) 740-2828 today.
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