Takeaways

• Employers must be aware of the WARN Act and state counterparts when taking employment actions in response to the potential federal funding freeze.
• Although certain WARN Act exceptions may be available, employers must act quickly regarding notifications in order to rely on those exceptions.
• Employers should consult with attorneys experienced in the WARN Act when considering any employment actions in response to the federal funding freeze.

Links

• Detail Matters: Recent Court Decision Finds Insufficient Information Limits Employer Reliance on WARN Exceptions
• Updated New York WARN Act Regulations Address Post-Pandemic Environment, Add Employer Obligations
• WARN Act Issues to Navigate for the Restaurant Industry

As President Donald Trump’s proposed federal funding freeze may take effect within the coming days, organizations that rely upon federal funding may be forced to consider layoffs, furloughs or hours reductions for employees. Employers should be cautious in considering any such actions as they all have potential federal or state WARN Act implications (along with other employment-related concerns) that could result in massive liability.

Under the federal Worker Adjustment Retraining Notification (WARN) Act, with certain exceptions for new and low-hour workers, entities that employ at least 100 employees are subject to the WARN Act. An employment loss for 50 or more full-time employees at a single site of employment, or that work remotely and report into a...

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