@083 CHAP 5 旼컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴커 � PLANT CLOSINGS, LAYOFFS: REQUIRED NOTICES � � BY EMPLOYERS TO EMPLOYEES UNDER "WARN" ACT � 읕컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴컴켸 For a business that has 100 or more full-time employees (or the equivalent, based on 40 hour work weeks) at a single location, you may be subject to the potentially onerous provisions of the "Plant Closing" law that was enacted by Congress in 1988 and which went into effect early in 1989. @IF000xx](Since your firm currently has no employees, these require- @IF000xx]ments are of no concern to @NAME.) @IF099xx]Since your firm currently has only @EMP employees, these pro- @IF099xx]visions don't apply to @NAME. @IF100xx]Your company has @EMP employees in total. If at least 100 of @IF100xx]your full-time employees (or the equivalent) work at a single @IF100xx]location, these stringent new provisions, as described below, @IF100xx]will very likely apply to @NAME. This legislation, called the "WARN" Act (Worker Adjustment and Restraining Notification Act), would affect you if you laid off 50 or more employees, or one-third of the work force, in a 30-day period. It applies to virtually any plant closing or major layoff for any reason, with a few obvious exceptions (such as for an earthquake or flood, or a labor dispute such as a strike or lockout, for which no notice need be given). A "layoff" under this Act includes any of the following: . A permanent termination of employment; . A layoff of an employee for more than six months; or . A loss of half the employees' working hours for six consecutive months; In case of any major layoff or shutdown, the law requires you to give at least 60 days advance notice. If you give less than that, you are required to pay the laid-off wor- kers for 60 days minus the actual number of days' notice you gave. The law requires you to notify the labor union that represents the employees, or, if none, the individual employees by mailing the notice to their last known address or including it in their pay envelope. You must also not- ify the local city or county government and state labor agency of the planned shutdown or cutback. @CODE: CA For example, you would be required to notify the Employment Development Department, in the case of a shutdown or layoff in California. @CODE:OF The WARN Act doesn't generally PROHIBIT a company from mak- ing layoffs or shutting down a money-losing plant, but it makes it more costly for the employer to do so, and also gives local unions and politicians time to find some way to attempt to coerce a company into maintaining an antiquated facility that is no longer economically viable. Count on being on the local 6:00 news if you try to shut down your business or part of it, if you have become a major local employer. The WARN law does impose stiff restrictions on a firm's ab- ility to sell off, reorganize, merge or consolidate opera- tions, if such a decision would adversely affect the jobs of 50 or more employees. In other words, if your Japanese competition renders your plant obsolescent, you may not be allowed to sell it off to a competitor if doing so would cost 50 or more employees their jobs. If not, it appears that your only option would be to simply board up the plant and go broke. Despite the claim by its sponsors that WARN would somehow make American business more competitive against foreign competition, it seems that it has made it much more costly to take a risk on building a plant in the U.S., since if it fails you may have to go down the tubes with it, rather than restructuring or selling it off. The unintended consequence of this supposed "job-saving" legislation (which, coincidentally, was timed to invite Reagan's veto just before the 1988 elections), will be to make any employer think long and hard about hiring more employees, and to start trying to find a way to automate every phase of its business. In effect, the government has taken the first major step towards West German-style social legislation, requiring that companies who hire employees must hire them for life, regardless of whether the business remains viable. In short, like West German employers have learned to do for years, you must become very careful about hiring employees if your business is subject to the WARN provisions, since you may be hiring them for life. In Germany, the result has been virtually zero growth in the number of jobs in the last decade or more, despite a very prosperous economy. Of course, that could never happen here.... This new law should create a great deal of employment for lawyers, however, if that is any consolation. There has already been a great deal of litigation over what does and does not constitute a mass layoff or shutdown under WARN. It's an ill wind that blows no one some good.... @CODE: ME HI Note that a plant closing law similar to the federal law has been enacted also by @STATE.