Does The WARN Act Apply To Remote Workers? A Guide For HR
Remote Work Realities: Remote work is here to stay, and HR must adapt to the challenges that come with it, especially in terms of layoffs and compliance with employment laws.
WARN Act 101: The WARN Act mandates that employers provide a 60-day notice for mass layoffs, ensuring employees have time to transition and find new opportunities following significant workforce changes.
Who Does WARN Protect?: The WARN Act primarily protects employees at businesses with 100+ full-time workers, highlighting its importance for larger companies navigating layoffs and closures in today’s work environment.
Future Challenges for HR Pros: As remote work evolves, HR professionals must stay informed about legal obligations like the WARN Act to effectively manage workforce changes and protect employee rights.
Remote work isn't going anywhere. As a result, HR professionals now have to navigate new complexities regarding layoffs and business closures from time to time. One critical question is whether the WARN Act, a federal law designed to protect employees in mass layoff situations, applies to remote workers.
In this guide, we’ll break down the key aspects of the WARN Act and explore its relevance to remote employees.
What Is The WARN Act?
The Worker Adjustment and Retraining Notification (WARN) Act is a U.S. federal law that requires employers to give advance notice to employees in the event of mass layoffs or business closures. Its purpose is to give workers sufficient time to find new employment or adjust to the changes.
Scope of the WARN Act
The WARN Act typically applies to businesses with 100 or more full-time employees. It mandates a 60-day notice period before closing a plant or laying off a significant portion of the workforce.
This requirement is designed to protect workers, their families, and communities by providing them time to prepare for job losses.
| Employer Size | WARN Act Applicability |
| 100+ employees | Subject to WARN Act |
| Less than 100 employees | Not subject to WARN Act (with some exceptions) |
State WARN Acts
In addition to the federal WARN Act, several states have implemented their own versions, sometimes known as Mini-WARN Acts. These state-specific regulations may be more stringent than federal requirements, offering workers even greater protection.
Notable State WARN Acts
- California WARN Act: Applies to employers with 75 or more employees and has stricter requirements, including notice for smaller layoffs.
- New York WARN Act: Requires 90 days of notice, exceeding the federal 60-day mandate, and applies to businesses with 50 or more full-time employees.
These state laws can overlap with federal WARN requirements, meaning employers must be aware of both levels of regulation to remain compliant.
How WARN Notices Work
So what are the standards and rules for providing WARN notices and remaining compliant. Well, as you can imagine, it varies by state, but for federal compliance, here are the basics.
Notice requirements
When layoffs are anticipated, employers must provide a 60-day advance notice to several parties:
- Affected employees or their representatives
- Unions, if applicable
- State and local government officials in the area where layoffs or closures will occur
Content of the notice
The notice must include specific details:
- Reason for the layoffs or closures
- Number of affected employees
- Timeline for the layoffs
- Job roles impacted by the decision
These details help ensure transparency and fairness during the layoff process. Failure to provide adequate notice can lead to significant penalties for the employer.
While the delivery of the notice is a key compliance concern, Albert Kim, Vice President of Talent Acquisition at Checkr emphasizes the importance of remembering that the livelihood of human beings is what is important to keep in mind here.
While you must mind your legal responsibilities, it’s important to remember there are humans at the other end of this notice,” he said. “For many, losing their jobs is one of the scariest things that can happen to them. Be empathetic, give ample time to ask and answer questions, and show respect throughout the process.
Penalties For Violating The WARN Act
This legislation was put in place to protect employees against improper firing practices and prevent employers from hiding details about company performance that will impact people’s job security. Failure to comply comes with some significant consequences.
Fines and legal action
Employers who violate the WARN Act by failing to provide the required notice can face serious penalties. These may include:
- Fines: Employers could be fined up to $500 per day of violation.
- Back pay: Employers are often liable for paying affected workers back wages for each day of non-compliance, which can quickly add up to a significant sum.
Employer liability
Non-compliance can lead to lawsuits from affected employees, who may seek compensation for lost wages, benefits, and other damages. In extreme cases, these legal battles can damage a company’s reputation and financial stability.
The WARN Act And Remote Workers
With more employees working remotely, companies must determine if the WARN Act applies to those individuals. The answer depends on several factors, including the geographic location of the remote workers and the company's central operations.
This is where the law gets a bit tricky due to its wording. When outlining the amount of time required to notify employees about mass layoffs, mass layoffs are defined as being related to a “single site of employment.”
Remote workers, then, seemingly don’t fit into this, as they don’t work at a single site, so many experts argue that this means the WARN Act doesn’t apply to them. If only things were that simple.
With remote work, it can be challenging to identify that location. In many cases, a remote worker’s home can be considered their single site of employment, especially if they do not regularly report to a physical office.
“The key is ensuring that each employee's main work location is well-defined,” says attorney Andrew Pickett. “This affects WARN Act applicability, especially when teams are stationed far and wide.”
Application to remote workers
So in short, yes, the WARN Act could apply to remote workers, but it depends on specific circumstances. For instance, if a company with 100 or more full-time employees plans a mass layoff that affects only remote workers, it’s possible those individuals may be entitled to WARN notices.
To steer clear of any legal troubles, it’s best to view remote employees the same as you would employees on a given job site.
"While the WARN Act doesn't explicitly state how remote workers are to be handled, they are covered as "out stationed employees," Thom Pryor, an employment law expert and Founder of Lawsuit Legal said. “More than just a common sense federal rule, it's a courtesy for their workers that good employers should want to follow."
Jurisdiction considerations
Jurisdiction plays a key role in determining WARN Act applicability for remote workers. Employers must consider the location of their headquarters and the states where remote employees reside.
For example, if a remote worker resides in California, the employer must comply with the California WARN Act, even if the company is based elsewhere.
Several factors determine whether the WARN Act covers remote workers:
- Number of affected employees: If the mass layoff involves 100 or more full-time workers (including remote staff), the WARN Act likely applies.
- Company headquarters: If the company operates in a state with a Mini-WARN Act, remote workers in that state might be protected by state-specific regulations.
- Remote worker’s state laws: Some states offer greater protections to workers, so it’s essential to understand both federal and state requirements.
Foreign Legislation Similar To The WARN Act
While the WARN Act is specific to the U.S., many other countries have similar laws to protect employees from sudden layoffs.
If you're operating internationally, this can become even more complicated. It's best to consider the use of an employer of record in this scenario as they'll help you navigate any local laws that apply to those workers.
Other countries’ versions
- United Kingdom: In the UK, employers must follow redundancy laws, which require consultations with employees when large-scale layoffs are planned.
- Canada: Canada’s federal and provincial laws mandate a minimum notice period for terminations, with specific rules varying by province.
- European Union: The EU has collective redundancy rules that require employers to notify both employees and government authorities of mass layoffs.
Global considerations
For companies with a global workforce, it’s critical to understand how different countries' laws apply to remote workers. Ignoring local labor laws can lead to costly penalties, even for remote teams based abroad.
For businesses with remote workers spread across different states or countries, understanding both the federal WARN Act and state or international labor laws will keep you out of trouble, which is why you need to consult an attorney and service providers who can help you on a day-to-day basis.
Best Employer of Record Services
To help you navigate the complexities of foreign legislation, we’ve compiled a list of Employer of Record service providers that lead the way in compliance.
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