The Trump administration’s push to downsize the federal workforce has entered a new phase, marked by rounds of layoffs, the deferred-resignation plan, and other voluntary departure programs. As the federal government shutdown enters its second week, the administration has escalated its response by threatening sweeping program cuts and workforce reductions.
As the administration continues its focus on reducing federal spending, many federal contractors are bracing for a wave of contract and grant reviews, reductions, and terminations. These changes, often sudden and sweeping, can force federal contractors and grant recipients into difficult decisions about workforce reductions. For recipients of federal funds, these decisions are not just operational or financial—they also carry significant legal obligations under the federal Worker Adjustment and Retraining Notification (WARN) Act, and in some cases, under state “mini-WARN” laws that can be even more stringent.
Navigating the complexities of the WARN Act and its state counterparts is essential to avoid costly damages, including back pay and benefits to each affected employee for the period of violation up to 60 days and attorneys’ fees. Below, we break down what federal contractors and grant recipients need to know about WARN Act compliance when implementing layoffs in response to government shutdown and federal contract terminations.
The WARN Act Overview
The WARN Act is a federal statute requiring covered employers to...
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