Any time a company announces a major layoff, it’s big news. Peloton Interactive (Peloton) recently announced that it will be letting go roughly 20% of its total workforce (including those located outside the United States). This type of story normally isn’t something employment lawyers take note of, unless the mass firing was somehow illegal. But how can a large layoff be illegal? One way is if it violates the WARN Act.
As far as we know, Peloton’s 2,800 worker layoff is perfectly legal and does not violate the WARN Act. But we can still use this event to get a better understanding of the WARN Act and what it does for employees.
What Is the WARN Act?
The Worker Adjustment and Retraining Notification (WARN) Act is a federal law that places conditions on how certain employers can conduct mass firings. Basically, the WARN Act requires a covered employer to provide 60 days’ notice to employees before closing a plant or conducting a layoff of a certain size.
Who’s Covered by the WARN Act?
If an employer has 100 or more employees, they’re most likely covered by the WARN Act. The WARN Act also largely applies just to private-sector employers, although government employers could be subject to the WARN Act’s requirements in limited situations. For example, if that government entity operates largely in the commercial realm and separately from regular government operations, then they could be subject to the WARN Act.
If an employee is working for an employer covered by the WARN Act,...
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