WARN Act

A federal law requiring employers to provide 60 days advance notice before mass layoffs or plant closings — with financial penalties for violations.

The Worker Adjustment and Retraining Notification (WARN) Act is a federal law that requires employers with 100 or more full-time employees to give at least 60 calendar days advance written notice before a plant closing or mass layoff. The 60-day notice window is intended to give workers time to seek new employment, access retraining programs, and make financial arrangements before losing their income.

WARN Act coverage triggers have specific thresholds. A plant closing triggers WARN if it results in employment loss for 50 or more employees at a single site of employment during any 30-day period. A mass layoff triggers WARN if it affects 500 or more employees at a single site, or 50–499 employees if that represents at least 33% of the active workforce at that site. The Act applies to full-time employees — part-time workers (fewer than 20 hours per week) and workers who have been employed less than 6 of the last 12 months are generally excluded from the count.

Several exceptions narrow WARN Act requirements in practice. The faltering company exception applies when a business is actively seeking capital or business to avoid a shutdown and reasonable grounds exist to believe that notice would prevent obtaining that capital. The unforeseeable business circumstances exception applies to sudden and dramatic market collapses or the loss of a major customer that the employer could not reasonably have predicted. The natural disaster exception covers plant closings caused by floods, earthquakes, or similar events. These exceptions are strictly construed and employers bear the burden of proving they qualify.

Many states have enacted mini-WARN acts with stricter requirements: lower employee thresholds, longer notice periods, or coverage of part-time workers. California's WARN Act, for example, applies to employers with 75 or more employees and requires 60 days notice — with no faltering company exception. New York's WARN Act covers employers with 50 or more full-time workers. Employees affected by layoffs should check both federal and state WARN requirements, because state mini-WARN laws may provide stronger protections and are often the basis of successful class action claims when employers fail to give proper notice.

What Employees Are Owed for WARN Violations

  • Back pay: up to 60 days of wages and benefits for each day the employer failed to provide required notice.
  • Benefits continuation: the value of benefits — health insurance, retirement contributions — that would have been provided during the notice period.
  • Civil penalties: employers who violate WARN may also owe up to $500/day in civil penalties payable to local governments.
  • Attorney's fees: prevailing employees can recover attorney's fees, making class actions economically viable even for smaller individual claims.
  • No cap: unlike some employment claims, WARN damages are directly tied to the number of days of missing notice — larger shortfalls mean larger recovery.
  • Class actions: WARN violations are frequently brought as class actions since all affected employees share the same claim.

WARN Act Exceptions and Limitations

  • Faltering company: employer was actively seeking financing to avoid shutdown and believed notice would jeopardize that financing — narrowly interpreted.
  • Unforeseeable business circumstances: sudden market collapse or loss of a major client that could not have been anticipated — must be genuinely unforeseen.
  • Natural disaster: plant closing caused by a flood, earthquake, or similar event directly — employer must still give as much notice as practicable.
  • Employer size: WARN only applies to employers with 100+ full-time employees — smaller companies are exempt from the federal requirement.
  • Employee count thresholds: a layoff affecting fewer than 50 employees does not trigger WARN even at a large employer.
  • State mini-WARN: many states apply stricter thresholds — check your state's requirements, as California, New York, and others have significantly expanded coverage.

Example

A retail chain with 500 employees closes three stores, resulting in 120 layoffs across two locations. The company provides only 30 days notice due to a surprise lease non-renewal. Employees file a WARN Act claim and recover 30 days of back pay and benefits — the difference between the required 60-day notice and the 30 days actually given.