NJ WARN Amended in Light of COVID-19 Pandemic

Asima J. Ahmad

On April 14, 2020, New Jersey Governor Phil Murphy signed Senate Bill 2353 into law, which excludes mass layoffs resulting from the coronavirus COVID-19 pandemic from the notice and severance pay requirements contained in the Millville Dallas Airmotive Plant Job Loss Notification Act (“NJ WARN”). Prior to this change, employers faced uncertainty on whether they would be obligated to provide notice and severance pay to each full-time employee that was terminated with less than the required 60-days’ notice due to the pandemic.

Specifically, SB 2353 revises the definition of “mass layoff” to mirror the exceptions that are already contained in NJ WARN’s definition of “termination of operations.” As a result, a mass layoff which would otherwise require notice shall not include one “made necessary because of a fire, flood, natural disaster, national emergency, act of war, civil disorder or industrial sabotage, decertification from participation in the Medicare and Medicaid programs as provided under Titles XVIII and XIX of the federal “Social Security Act,” Pub.L. 74-271 (42 U.S.C. s.1395 et seq.) or license revocation pursuant to P.L.1971, c.136 (C.26:2H-1 et al.).” These changes go into effect immediately and are retroactive to March 9, 2020, the date that Governor Murphy declared a COVID-19-based state of emergency and public health emergency in New Jersey via Executive Order 103.

SB 2353 also changed the effective date of the most recent amendments to NJ WARN, set forth in SB 3170, which Governor Murphy signed into law in January 2020 and were to go into effect on July 19, 2020. As a result of the Governor’s signature of SB 2353, the amendments made by SB 3170 will not go into effect on July 19 but, instead, will go into effect on the 90th day following the date that the Governor lifts the state of emergency announced in Executive Order 103.

As a reminder, SB 3170 dramatically expanded the requirements and obligations related to plant closings, transfers, and mass layoffs. Once in effect, NJ WARN will cover employers with 100 or more employees (regardless of tenure or hours of work) and will be triggered when 50+ employees are laid off by the employer anywhere within the state and regardless of whether the 50 employees equate to at least one-third of the employer’s employees. Employers with 100+ will need to provide 90-days’ notice (rather than 60) to affected employees. And, most significantly, even if they give timely notice to employees, employers will be required to provide severance pay to all terminated employees (in an amount equal to one week of pay for each full year of employment), with an additional four weeks’ severance required if less than 90-days’ notice is provided. Employees are not permitted to waive the right to severance without approval of the Commissioner of Labor and Workforce Development or a court.

Please contact a member of the Blank Rome team prior to implementing any changes that may trigger NJ WARN’s requirements to ensure compliance and answer any questions you may have regarding its application.

For the latest updates, please visit Blank Rome’s Coronavirus (“COVID-19”) Task Force page.

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