Layoff laws & compensation compliance analysis

Layoff: What you need to know

A layoff is a termination of employment at the will of the employer. It may be temporary or permanent and can occur for several reasons including downsizing, changes in market conditions, or new technology.
The federal Worker Adjustment and Retraining Notification Act (WARN Act) imposes restrictions on the way layoffs are handled (29 U.S.C. Sec. 2101 et seq.; 29 U.S.C. Sec. 639.1 et seq.).
WARN is designed to give employees advance notice of layoff to allow them to find other employment and/or seek retraining in a new occupation. This notice also gives state dislocated-worker units adequate preparation time to better assist affected workers.
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Employers must comply with the WARN Act if they have 100 or more full-time employees or 100 or more employees, including part-time employees, who regularly work a total of 4,000 hours per week, exclusive of overtime.
Part-time employees. The Act defines “part-time employees” as those who work an average of fewer than 20 hours per week or who have been employed for fewer than 6 of the 12 months preceding the date on which notice is required (29 U.S.C. Sec. 2101).
Temporary employees. Temporary employees are individuals hired with the understanding that their jobs will end when a specific project ends.
Workers on temporary layoff who have a reasonable expectation of recall are counted as employees.
An employee has a reasonable expectation of recall when he or she understands, through notification or industry practice, that his or her employment has been temporarily interrupted and that he or she will be recalled to the same or a similar job (20 CFR Sec. 639.3).
Public employers. Regular federal, state, and local government entities that provide public services ...

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