COVID-19 Client Alerts:
New EDD Guidance on Mass Layoffs and Closures
New EDD Guidance on Mass Layoffs and Closures
Recognizing that employers have had to rapidly close down their businesses to prevent or mitigate the effects of the COVID-19 pandemic, but have not been able to provide their employees with the usual advance notice of at least 60 days, Executive Order N-31-20 provides a conditional suspension of the usual 60-day notice requirement.
The California WARN Act generally requires 60 days’ notice for three different types of closures:
- A mass layoff, which is a layoff during any 30-day period of 50 or more employees at a covered establishment.
- A relocation, which is the removal of all or substantially all of the industrial or commercial operations in a covered establishment to a different location 100 miles or more away.
- A termination, which is the cessation or substantial cessation of industrial or commercial operations in a covered establishment.
The Executive Order temporarily suspends the 60-day notice requirement for those employers that give written notice to employees and satisfy other conditions. According to recent guidance from EDD, in lieu of providing the required 60-day notice, employers must satisfy the following three requirements:
- The employer’s mass layoff, relocation or termination must be caused by COVID-19-related “business circumstances that were not reasonably foreseeable at the time that notice would have been required.” The U.S. Labor Department, which EDD follows in this regard, has interpreted such “business circumstances” to include “[a] government ordered closing of an employment site that occurs without prior notice.”
- The employer must provide written notices to:
a. Employees affected by the mass layoff, relocation or termination;b The EDD;c. The Local Workforce Development Board; andd. The chief elected official of each city and county government within which the termination, relocation, or mass layoff occurs.
- The employer must provide written notice that satisfies the following requirements:
a. Give as much notice as is practicable (i.e., reasonably possible).b. Explain why the 60-day notification period could not be met.c. Include the following information in the notice to each affected employee:
i. Indicate whether the planned action is expected to be permanent or temporary, and whether the entire location will be closed;
ii. The expected date when the plant closing or mass layoff will start, and the expected date when the individual employee will be separated;
iii. Whether bumping rights exist;
iv. The name and phone number of a company official to contact for further information;
v. The following statement: “If you have lost your job or been laid off temporarily, you may be eligible for Unemployment Insurance (UI);
vi. The notice may include additional information useful to the employees, such as the estimated duration if the planned action will be temporary, if known.
d. The notices to the EDD, the Local Workforce Development Board, and the chief elected official of each city and county government within which the termination, relocation, or mass layoff occurs must include the following:
i. Name and address of the employment site where the closing or mass layoff will occur;
ii. Name and phone number of a company official to contact for further information;
iii. Whether the planned action is expected to be permanent or temporary. and whether the entire location is to be closed;
iv. Expected date of the first separation, and the anticipated schedule for subsequent separations;
v. Job titles of positions to be affected, and the number of employees to be laid off in each job classification;
vi. When layoffs occur at multiple locations, a breakdown of the number and job titles of affected employees at each location;
vii. Whether bumping rights exist;
viii. Name of any affected union;
ix. Name and address of the chief elected officer of each union, if applicable;
x. The notice may include additional information useful to the employees, such as if the planned action is expected to be temporary, the estimated duration, if known.
Please be mindful that the Governor’s Order only affects Cal-WARN. Federal WARN can create additional requirements under the same or different circumstances.
Copyright © 2020, Murphy Austin Adams Schoenfeld LLP. All rights reserved. Please be assured that we make every effort to make certain that the information contained in this alert is current at the time this email was delivered. Because laws and legislation are constantly changing, please contact us if you are unsure whether this material is still current. Nothing contained herein should be construed as legal advice or a legal opinion on any specific facts or circumstances. The contents are intended to be for general information purposes only. We assume no liability in connection with the use of the information contained in this article. Given the rapidly evolving nature of legal and governmental responses to the COVID-19 pandemic, unfolding events likely will supersede many of the issues discussed in these updates. We encourage you to contact our lawyers directly for the most current information and counsel regarding legal and governmental responses to the COVID-19 pandemic. Please contact us to answer any questions you may have.
Aaron B. Silva, Labor and Employment Law Partner
916.446.2300, Ext. 3027
Shawn M. Joost, Labor and Employment Law Associate
916.446.2300, Ext. 3010