The Fourth Circuit issued an opinion in Messer et al. v. Bristol Compressors International, LLC et. al. that should serve as a cautionary tale to employers planning to use severance agreements when implementing layoffs. There, the court considered three questions. First, whether Bristol Compressors validly eliminated its severance plan before terminating Plaintiffs’ employment. Second, whether certain Plaintiffs who signed a Stay Bonus Letter Agreement (“SBLA”) waived their claims against Bristol Compressors. And third, whether four of the Plaintiffs received adequate notice under the WARN Act before their employment was terminated.
Continue Reading Fourth Circuit Outlines Pitfalls in Using Severance Plans for Layoffs

The Worker Adjustment and Retraining Notification (“WARN”) Act requires employers to give employees at least 60 days’ notice when a “mass layoff” is about to occur at a “single site of employment,” which is typically a single location or a group of contiguous work locations.  Courts are beginning to confront the question of what constitutes a “single site of employment” under the WARN Act for employees working remotely, and how remote work policies impact class certification considerations.  Given the prevalence of remote work during the pandemic and the likely continuation of such work arrangements, these decisions are of particular importance to employers considering mass layoffs or facing class actions based on the application of remote work policies or practices.
Continue Reading Remote Employees Can Bring Class Action Under The WARN Act

While COVID-19 may have hit the business community like a hurricane, whether the pandemic, in fact, qualifies for a natural disaster exception under the federal law requiring businesses to warn employees of impending layoffs, remains an open question. This February, a federal judge paved the way for the Eleventh Circuit to weigh in on whether a class action can proceed against an employer who was forced to lay off employees due to COVID-19.
Continue Reading The Eleventh Circuit Could Tackle Whether COVID-19 is a Disaster for WARN Purposes with Companies Facing Continued Layoffs

The COVID-19 pandemic has exposed employers to an influx of novel employment law issues.  Many employers already have experienced an uptick in related internal complaints or litigation. We identify five particular employment law liabilities employers may be exposed to once the dust settles from the pandemic.
Continue Reading Top Five Employment Law Liabilities Facing Employers Post-Pandemic

No doubt recognizing the unprecedented impact on business, Governor Gavin Newsom issued an Executive Order suspending the notice requirements under the California Worker Adjustment and Retraining Notification Act. Cal. Lab. Code §§ 1401(a), 1402, 1403. The Executive Order suspends existing law that could have otherwise required employers to provide 60 days’ notice before instituting mass layoffs, relocations, or terminations, and could potentially have imposed steep penalties on employers who failed to do so.  Certain notice obligations remain, however, under the Executive Order.
Continue Reading California Suspends Mini-WARN Obligations, But Still Mandates Notice

Jurisdiction

Jurisdiction may be the most important factor organizations should take into consideration when offshoring.  Some countries do not recognize certain U.S. legal doctrines, such as confidentiality agreements, and without proper jurisdiction an organization may be unable to enforce its contract with a vendor.

When selecting an offshore country, organizations should consider whether the country permits a choice of law provision which would allow courts to apply U.S. law.  If the country permits choice of law provisions, the provision should be well defined in the contract so that there is no ambiguity.  Organizations should also consider working with counsel in the offshore country to assist with legal intricacies, even if a United States choice of law provision is permissible.Continue Reading Top Ten Considerations in Offshore Outsourcing

A Mississippi Bankruptcy Court recently addressed several employer defenses to liability under the Worker Adjustment and Retraining Notification Act (“WARN Act”), which is noteworthy in the context of the current economy.  In re FF Acquisition Corp. d/b/a Flexible Flyer, 423 B.R. 502 (Bankr. N.D. Miss. January 20, 2010).Continue Reading Recent Bankruptcy Decision Highlights Defenses Against WARN Act Claims

The drama in late 2008 surrounding the factory shutdown of Republic Window & Doors in Chicago, Illinois, highlighted for banks and other financial institutions the potential backlash when a debtor business fails.  In that situation, the factory’s lender faced a public relations challenge when it declined (with good reason) to continue a line of credit