CLIENT UPDATE

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July 9, 2010

New York Department of Labor Issues Final
Emergency WARN Regulations

On May 12, 2010, the New York State Department of Labor (“NY DOL”) enacted regulations for the New York State Worker Adjustment and Retraining Notification Act (“NY WARN”), which finalized the emergency regulations issued for public comment on January 30, 2009.  (See our February 25, 2009 Client Alert, available here ).  The final regulations apply on and after July 10, 2010.

New York WARN Act

The NY WARN Act was enacted in August 2008 to supplement the requirements of the Federal WARN Act, which requires employers with 100 or more employees to provide at least sixty (60) calendar days written notice of covered plant closings and mass layoffs.  NY WARN covers employers with fewer employees and requires employers to provide more extensive notice than the Federal WARN Act.  Specifically, New York employers with 50 or more employees must provide at least 90 days’ notice. Notice must be tendered to affected employees, their representatives, the New York Department of Labor, and the local Workforce Investment Board prior to a plant closing, mass layoff, relocation, or other covered reduction in work hours. 

Under NY WARN, employees may bring a civil judicial action for failure to provide adequate notice of a covered event.  Alternatively, aggrieved parties may bring administrative enforcement actions before the New York Commissioner of Labor.  The Commissioner of Labor may seek back wages, as well as the value of the cost of any benefits to which the employee would have been entitled during the required notice period, and may impose penalties for violations of up to $500 for each day of the employer’s violation. 

 

2010 NY WARN Emergency Regulations

Enhanced Notice Requirements – The new emergency regulations include amended procedural requirements.  Notices must be postmarked 90 days prior to separation or marked “urgent,” when permitted to be sent via e-mail.  E-mail notification may be used only when all affected employees have regular access in the workplace to personal computers at which e-mail may be received and viewed during work hours.  As compared to Federal WARN regulations, which encourage but do not require the inclusion of useful information on disclosed worker assistance programs, NY WARN requires the notice to inform employees that they may be eligible for unemployment insurance benefits after their last day of employment. 

Triggering Events – The new emergency regulations clarify that a covered reduction in work triggers the NY WARN’s notice requirements if it affects at least 25 full-time employees and at least 33% of the full-time workforce at the affected job site, or if 250 employees will be affected regardless of the percentage of the workforce involved. Notice is not required for a closing or layoff that results from the completion of a seasonal project, provided the employer demonstrates that the affected employees understood their employment to be temporary.

Employer Liability – The new emergency regulations clarify that an employer’s liability period for failure to comply continues from the employee’s layoff date (i.e., the last day the employee is permitted to work) for up to 90 days after the date the employee received notice of the layoff.  To avoid penalties, an employer can pay employees all amounts due within three (3) weeks of the layoff date.   Employers may also offset liability by paying wages after notice has been given, as well as by making voluntary, unconditional payments that are not required to satisfy any legal obligations. Vacation pay, severance benefits, and other payments required by contracts, collective bargaining agreements, or other legal obligations will not offset NY WARN liability.

Putney, Twombly, Hall & Hirson LLP