Labor & Employment Law Daily Workers who stayed employed more than 60 days after defective notice can’t pursue WARN Act damages
News
Thursday, August 13, 2020

Workers who stayed employed more than 60 days after defective notice can’t pursue WARN Act damages

By Marjorie Johnson, J.D.

Though the changing circumstances around the plant closing undoubtedly left the four class members with uncertainty about exactly when their employment would end, there was no evidence that the employer led them to believe they would be employed indefinitely.

In a class action alleging violations of the Worker Adjustment and Retraining Notification (WARN) Act, an employer was entitled to summary judgment on the claims of four workers who had remained employed more than 60 days after initially receiving a technically defective notice of the impending plant closure that ultimately led to their termination. Applying a “substantial compliance test,” a federal district court in Virginia ruled that while there were technical violations of the Act since initial notice of plant closing was deficient and the employer also should have provided additional notice of the postponement, the employees “received notice that served the purpose of the WARN Act: to allow them adequate time to prepare for losing their jobs” (Messer v. Bristol Compressors International, LLC, August 6, 2020, Jones, J.).

Inadequate notice of expected closure. On July 31, 2018, the employer issued letters to its employees stating that it expected its Bristol, Virginia, facility to permanently close “by or about August 31, 2018.” The four workers at issue were also told that their employment would end sometime during the month of August 2018. Had the facility in fact closed on August 31, they would have only received between 1- and 30-days’ notice of their termination.

The employer’s prediction proved overly pessimistic and it was able to secure enough final orders from its customers to continue operations until November 2018. As a result, the four workers were actually not terminated until October 19—more than 60 days after they received the July 31 notice but less than 60 days after the date upon which they were initially told their employment would end. The employer also did not provide any notice of the revised termination dates following the July 31 letter.

Advance notice? The employer argued that because the four workers remained employed for more than 60 days after receiving the July 31 notice, they were not entitled to any WARN Act damages. The workers countered that because they received no new notice after the predicted August 31 closure date passed, they effectively received no advance notice of their October 19 terminations and thus were entitled to be paid for the full 60-day WARN Act notice period.

Notice requirements. The WARN Act’s regulations direct that the requisite 60-day notice “must be specific” and “based on the best information available to the employer at the time the notice is served.” However, it is not their intent “that errors in the information provided in a notice that occur because events subsequently change or that are minor, or inadvertent errors are to be the basis for finding a violation of WARN.”

The notice must list either “a specific date” or “a 14-day period” during which the employee’s separation is expected and if a 14-day period is used, notice must be provided at least 60 days before the first day of that period. The notice must indicate not only the date on which the plant is expected to close, but also the date on which the individual employee is expected to be terminated. Additionally, employers are required to give additional notice if the date(s) 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 notice.

“Substantial compliance.” Though the Fourth Circuit has not addressed the scenario presented here, the district court was persuaded by other circuits’ adoption of a “substantial compliance” test. For instance, the Fifth Circuit found that a group of workers who had actually worked and been paid for more than 60 days after receiving notice of their pending termination due to a merger were not entitled to WARN Act damages, noting that “neither the Act nor the regulations suggest that defective notice is automatically to be treated as though no notice had been provided at all.” Similarly, in finding a WARN Act notice adequate despite its failure to include expected termination dates and other required information, the Federal Circuit found that the employee at issue “suffered no prejudice as a result of the technical defect” in the notice.

Notice technically defective. Here, the July 31 notice that the four workers received was defective insofar as it did not identify either a specific date or a 14-day period in which they were expected to be terminated, but instead provided a month-long window. But while this longer time period did not technically comply with the regulations, the court found that the employer substantially complied with the Act’s notice requirements. “Despite its deficiencies, the July 31 notice that these employees received cannot be deemed no notice.”

No prejudice. Because the original termination period and plant closing were postponed, the employer should have given additional notice as directed by the Act. Nevertheless, the four workers knew that the plant was going to close for more than 60 days before they were ultimately terminated and there was no evidence that they suffered any prejudice from the lack of additional notice. According to the regulations, “errors in the information provided in a notice that occur because events subsequently change” should not “be the basis for finding a violation of WARN.”

The changing circumstances around the plant closing undoubtedly left the four workers with uncertainty about exactly when their employment would end, but there was no evidence that they were led to believe their employment would continue indefinitely. “Despite technical violations, they received notice that served the purpose of the WARN Act: to allow them adequate time to prepare for losing their jobs.”

Interested in submitting an article?

Submit your information to us today!

Learn More

Labor & Employment Law Daily: Breaking legal news at your fingertips

Sign up today for your free trial to this daily reporting service created by attorneys, for attorneys. Stay up to date on labor and employment legal matters with same-day coverage of breaking news, court decisions, legislation, and regulatory activity with easy access through email or mobile app.