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A layoff is a termination of employment at the will of the employer. It may be temporary or permanent and can occur for a number of reasons including downsizing, changes in market conditions, or new technology. The Worker Adjustment and Retraining Notification Act (WARN Act) imposes restrictions on the way layoffs are handled (29 U.S.C. Sec. 2101et seq.; 29 U.S.C. Sec. 639.1et seq.). It is designed to give employees advance notice of the layoff in order to find another job and/or seek retraining in a new occupation and to give state dislocated-worker units adequate preparation to assist affected workers.
Employers must comply with the WARN Act if they have 100 or more full-time employees or 100 or more employees, including part-time employees, who regularly work a total of 4,000 hours per week, exclusive of overtime. The Act defines part-time employees as those who work an average of fewer than 20 hours per week or who have been employed for fewer than 6 of the 12 months preceding the date on which notice is required (29 U.S.C. Sec. 2101).
Temporary employees are individuals hired with the understanding that their jobs will end when a specific project ends. Workers on temporary layoff who have a reasonable expectation of recall are counted as employees. An employee has a reasonable expectation of recall when he or she understands, through notification or industry practice, that his or her employment has been temporarily interrupted and that he or she will be recalled to the same or a similar job (20 CFR Sec. 639.3). In addition, an employer may have several sites of employment under common ownership or control, yet there is only one "employer" for purposes of the Act.
Independent contractors and subsidiaries. Independent contractors and subsidiaries that are wholly or partially owned by a parent company may be considered separate employers or part of the parent or contracting company depending upon their degree of independence. Some of the factors to be considered in making this determination are (i) common ownership, (ii) common directors and/or officers, (iii) de facto exercise of control, (iv) unity of personnel policies emanating from a common source, and (v) the dependency of operations (20 CFR Sec. 639.3).
Sale of the business. In the event of a sale of part or all of an employer's business, the seller is responsible for providing notice of any plant closing or mass layoff that takes place up to and including the effective date of the sale, and the buyer is responsible for providing notice of any plant closing or mass layoff that takes place after the effective date of the sale (29 U.S.C. Sec. 2101). A ruling from the Court of Appeals for the 7th Circuit illustrates this point (Phason v. Meridian Rail Corp., 479 F.3d 527 (7th Cir., 2007)). The court held that an employer that terminated its employees 8 days before the formal sale of its business violated the WARN Act. In mid-December, the seller notified its employees of an impending change in ownership after it had shaken hands on the deal. On December 31, the seller notified its workforce that it was closing and invited its employees to apply for jobs with the buyer. Days later, on January 8, the deal formally closed. The court rejected the seller's argument that because it sold its business and the buyer hired many of its workers, no employment loss occurred. The court held that the seller violated the Act because it terminated its employees before the formal closing of the sale, noting that a "handshake" is not a sale of a business. Had the deal actually closed on December 31, the date of termination, the employees would not have had a claim against the seller.
As a practical matter, employers should note that the requirements of the WARN Act may be interpreted literally by the courts. Therefore, employers should work closely with an employment law attorney when planning and negotiating a business transaction.
Public employers. Regular federal, state, and local government entities that provide public services are not covered by the Act (20 CFR Sec. 639.3).
Employees covered. Employees entitled to notice under the WARN Act include hourly and salaried workers as well as managerial and supervisory employees.
Effect of state laws and collective bargaining agreements. The WARN Act does not replace state laws or collective bargaining agreements that may require additional notice. Several states have enacted "mini-WARN" laws providing employees with greater protections than the federal WARN Act. Employers should check to see if their state has any advance notice requirements.
The law requires covered employers to give their affected employees 60 days' notice of a “mass layoff ” or a “plant closing” that is expected to last 6 months or longer. Employers must also notify local government officials and their state dislocated worker unit. Additional notice is needed if the planned layoff date is extended. An employer may not order a plant closing or mass layoff until the end of the 60-day notice period and after the employer has served written notice of such an order.
When all employees are not terminated on the same date, the date of the first individual termination within the statutory 30-day or 90-day period triggers the 60-day notice requirement. A worker's last day of employment is considered the date of that worker's layoff. The first and each subsequent group of affected employees is entitled to a full 60 days' notice. The point in time at which the number of employees is to be measured for purposes of determining coverage under the Act is the date on which the first notice is required to be given (20 CFR Sec. 639.5).
Definitions. The WARN Act defines the preceding terms as follows:
• "Mass layoff" is defined as a reduction in force that (a) is not the result of a plant closing; and (b) results in an employment loss at a single site of employment during any 30-day period for (1) at least 33 percent of the employees and at least 50 employees (excluding part-time employees) or (2) at least 500 employees (excluding any part-time employees).
• "Plant closing" is defined as a permanent or temporary shutdown of a single site of employment, or one or more facilities or operating units within a single site of employment, if the shutdown results in an employment loss at the single site of employment during any 30-day period for 50 or more employees, excluding part-time employees.
• "Employment loss" is defined as (1) an employment termination other than a discharge for cause, voluntary departure, or retirement; (2) a layoff exceeding 6 months; or (3) a reduction in work hours of more than 50 percent during each month of any 6-month period. Employment loss does not occur if the closing or layoff is the result of the relocation or consolidation of part or all of the employer's business and, before the closing or layoff, (a) the employer offers to transfer the employee to a different site within a reasonable commuting distance with no more than a 6-month break in employment; or (b) the employer offers to transfer the employee to any other site of employment regardless of distance with no more than a 6-month break in employment and the employee accepts within 30 days of the offer or of the closing or layoff, whichever is later (29 U.S.C. Sec. 2101).
Note: Employment losses for two or more groups at a single site within a 90-day period, each of which involves less than the minimum number of employees to qualify as a plant closing or mass layoff but, in the aggregate, do exceed the minimum number of employees, will be considered a mass layoff or plant closing unless the employer can demonstrate that there were two separate and distinct actions and there was no attempt to evade the WARN Act requirements (29 U.S.C. Sec. 2102).
What is a single site of employment? According to federal regulations, a "single site of employment" is either a single location or separate facilities that are in geographic proximity, used for the same purpose, and that share staff and equipment (20 CFR Sec. 639.3). Interpreting these requirements, the 9th Circuit Court of Appeals held that separate construction sites could not be considered for purposes of determining whether an employer has enough employees to be subject to the WARN Act (Bader v. Northern Line Layers Inc., 503 F.3d 813 (9th Cir. 2007)). In this case, the employees claimed that their layoffs violated the Act because there were more than 50 affected workers and their employer's multiple jobsites should have been considered along with its headquarters as a single site of employment. The court rejected this argument because the sites were not geographically near to the headquarters or each other, employees were not assigned to the headquarters, their work was not assigned at the headquarters, and the employees did not report to the headquarters.
What is significant is that if any of these factors were different, the sites would have been considered part of a single site of employment and the WARN Act would have applied. When considering layoffs, employers should carefully consider any obligations they may have under the law so that they do not unintentionally violate it.
Determining whether a departure was "voluntary." Two federal courts have interpreted the meaning of a "voluntary departure." The 9th Circuit Court of Appeals held that if an employee leaves a job because the business is closing, the employee has not voluntarily departed for purposes of the WARN Act (Collins v. Gee West Seattle, 631 F.3d 1001 (9th Cir. 2011)). (The 9th Circuit covers Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon, and Washington.) In this case, an employer with about 150 employees announced that it would close down if it could not find a buyer within 11 days. Following the announcement, employees stopped coming to work. With only 30 employees reporting to work, the employer shut down 9 days after its announcement. The employer argued that it was not required to comply with the notice provisions of the WARN Act because all but 30 of its employees voluntarily departed before the closing. The court disagreed, stating that unless there is evidence that employees left for reasons other than the shutdown, it would be unreasonable to conclude that they left voluntarily after being notified that the business was closing.
In another case, the 7th Circuit Court of Appeals (covering Illinois, Indiana, and Wisconsin) held that employees voluntarily departed when they entered severance agreements following an announcement that their employer would be shutting down operations (Ellis v. DHL Express, 633 F.3d 522 (7th Cir. 2011)). The court held that even though some employees had only 2 days to consider whether to take the severance package, their departure was still voluntary. The court noted that the employer did not harass or pressure the employees to accept the severance agreement and it did not provide them with incomplete information. Thus, these employees were not counted for purposes of triggering the notice requirements of the WARN Act.
Practice Tip: Employees who stop coming to work when a plant closing is imminent may need to be counted for purposes of determining if the WARN Act applies. Under these circumstances, employers should consult with an experienced employment law attorney in their jurisdiction for advice on their obligations under the WARN Act or similar state law.
Extension of layoff period. When a layoff that was initially announced to be a layoff of 6 months or less lasts more than 6 months, it is treated as an employment loss unless:
• The extension to longer than 6 months was caused by a business circumstance not reasonably foreseeable at the time of the initial layoff; and
• Notice was given when it became reasonably foreseeable that the layoff would last longer than 6 months (29 U.S.C. Sec. 2102).
Employers must provide different types of information to employees depending upon whether or not they are unionized. Employers must always notify the state. Notice may be sent by any method designed to ensure receipt at least 60 days before separation, e.g., first-class mail, personal delivery, or insertion of a notice into pay envelopes (20 CFR Sec. 639.6 to 639.8).
Union employees. If employees are unionized, only the chief elected union representative must be given notice. The notice must contain:
• The name and address of the employment site where the plant closing or mass layoff will occur and the name and telephone number of a company official to contact for further information;
• A statement as to whether the planned action is expected to be permanent or temporary and whether the entire plant is to be closed;
• The expected date of the first separation and the anticipated schedule for making separations; and
• The job titles of positions to be affected and the names of workers currently holding these jobs.
Note: Unionized employers should seek additional legal advice because the WARN Act and the National Labor Relations Act may have different notice and bargaining requirements. The Supreme Court has ruled that unions may sue on behalf of its members for WARN Act violations (United Food and Commercial Workers Union Local 751 v. Brown Group, Inc.,, 517 U.S. 544 (1996)).
Nonunion employees. Employees who may reasonably be expected to experience an employment loss and who are not represented by a union must be notified individually in writing. While part-time employees are not counted in determining if a plant closing or mass layoff had occurred, these workers must get a notice if they will experience an employment loss. The notice must include:
• A statement as to whether the planned action is expected to be permanent or temporary and whether the entire plant is to be closed;
• The expected date when the plant closing or mass layoff will begin and the expected date when the individual employee will be separated;
• An indication of whether bumping rights exist; and
• The name and telephone number of a company official to contact for further information.
State notification. Employers must always notify the state dislocated worker unit and the chief elected official of the local government unit within which the closing or layoff will occur. The notice must include:
• The name and address of the employment site where the plant closing or mass layoff will occur;
• The name and telephone number of a company official to contact for further information;
• The nature of the planned action, including whether it is a plant closing or a mass layoff and whether it is expected to be permanent or temporary;
• The expected date of the first separation and the anticipated schedule for making separations;
• The job titles of positions to be affected and the number of employees in each job classification;
• An indication of whether or not bumping rights exist; and
• The name of each union representing affected employees and the name and address of the chief elected officer of each union.
The WARN Act's notice requirements do not apply if:
• The closing is of a temporary facility;
• The closing or layoff is the result of the completion of a particular project when the employees involved were hired with the understanding that employment was limited to the duration of the facility or the project; or
• The closing or layoff constitutes a strike or lockout (29 U.S.C. Sec. 2103).
Additionally, there are three other important exceptions to the 60 days' notice requirement that are explained in the U.S. Department of Labor's regulations interpreting the WARN Act (20 CFR 639.9). Employers claiming these exemptions are required to give as much notice as they can, along with a brief statement of why the notification period has been reduced. The employer has the burden of proving that the conditions for an exception have been met. These exceptions are:
• The faltering company exception;
• The unforeseen business circumstances exception; and
• The natural disaster exception.
Faltering company exception. The faltering company exception, which is narrowly construed, applies only to plant closings and not mass layoffs. In order for it to apply, the employer must have been actively seeking capital or business, at the time notice would have been required, that was realistically obtainable and, if obtained, would have allowed the employer to avoid or postpone the shutdown. In addition, the employer must have reasonably and in good faith believed that giving the required notice would have prevented the employer from obtaining the financing or business. This means that the employer must be able to objectively show that it believed that a potential customer or source of financing would have been unwilling to provide business or financing to the new business if the public knew that there might be a closing.
Practice tip: One way to satisfy the faltering company exception is by showing that the finance or business source would not choose to do business with a troubled company or with a company whose workforce would be looking for other jobs.
Note: This exception will be viewed in a companywide context, so a company with access to financing or with cash reserves may not use it based solely on the financial condition of the plant that is being closed.
Unforeseen business circumstances exception. This exception applies to plant closings and mass layoffs caused by business circumstances that were not reasonably foreseeable at the time that the 60-day notice would have been required. An important indicator that a circumstance is not reasonably foreseeable is that it is caused by some sudden, dramatic, and unexpected action or condition outside the employer's control. Examples include a principal client's sudden termination of a major contract, a strike at a major supplier, or an unexpected and dramatic economic downturn. The test for determining when circumstances are reasonably foreseeable focuses on an employer's business judgment. The employer must exercise the same commercially reasonable business judgment that a similarly situated employer would in predicting the demands of its particular market. The employer, however, does not have to accurately predict general economic conditions.
Government actions. A government-ordered closing of an employment site that occurs without prior notice may also fall under the unforeseen business circumstances exception. An employer may also not be held liable under the Act for a government ordered mass layoff (Deveraturda v. Globe Aviation Security Services, 454 F.3d 1043 (9th Cir. 2006)).
Natural disaster exception. This exemption applies to plant closings and mass layoffs due to any form of a natural disaster. Examples include floods, earthquakes, droughts, storms, tidal waves or tsunamis, and similar events. The employer must be able to demonstrate that its plant closing or mass layoff was in fact due to the natural disaster. While a disaster may preclude full notice, as much notice as possible must be given. Plant closings or layoffs that are the indirect result of a natural disaster are not covered by this exception, but may fall under the unforeseen business circumstances exception.
Any employer that violates the Act's notice requirements may be liable to each affected employee who suffers an employment loss. An aggrieved employee may claim back pay for each day of the violation period in an amount equal to his or her average regular rate for the previous 3 years or final regular rate. The employer may also be held liable for lost benefits and be subject to a civil fine of up to $500 for each day it is in violation of the Act. Damages paid to any aggrieved employee will be reduced by any wages paid by the employer to the employee during the violation period, any voluntary and unconditional payment by the employer to the employee that is not required by some legal obligation, and any payment by the employer to a third party or trustee on behalf of the employee during the violation period (29 U.S.C. Sec. 2104).
Computation of damages. The damages an employer may have to pay if it violates the WARN Act have been the subject of several court cases. The majority of federal circuit courts of appeal have ruled that employers are liable for each "work" day within the violation period. However, the 3rd Circuit has held that employers are liable for each "calendar" day during the violation period. At least one court has held that back pay includes tips and holiday pay that employees would have earned had they been working (Local Joint Executive Board of Culinary/Bartender Trust Fund v. Las Vegas Sands, Inc., 244 F.3d 1152 (9th Cir. 2001)). In the same case, the court held that WARN Act damages may not be reduced by severance pay or accrued vacation pay that the employer was otherwise obligated to pay.
Waivers. Employers often ask their employees to sign releases waiving their rights under the WARN Act in return for additional consideration. The Department of Labor (DOL) has stated that employees cannot be required to waive their right to the WARN Act notice. However, employees may agree to waive their rights to make claims against the employer. DOL has published an employer's guide to the WARN Act that can be accessed at http://www.doleta.gov.
In some cases, employers can avoid layoffs by instituting other cost-cutting measures so that the financial burden of an economic downturn is shared among employees. Employees benefit despite the hardship of reduced hours and/or pay, because they are able to keep their jobs. Employers also benefit by maintaining a well-trained workforce ready to resume maximum production or service levels when the economy improves. Additionally, when employers try to avoid layoffs, they often gain the goodwill and loyalty of their employees. Examples of alternatives to layoffs include:
• Work sharing;
• Reduced pay;
• Furloughs;
• Reduced benefits; and
• Early retirement.
Work sharing. Work sharing allows employees to share the work that remains after some jobs are lost due to adverse economic conditions. Under a work-sharing arrangement, employees may work a reduced week or work every other week. Their hourly pay remains the same but reflects the reduced hours. In some states, the unemployment compensation laws allow employees to collect partial unemployment benefits during a work-sharing period.
Reduced pay. A reduction in pay works best if it is shared by all employees, including management. It may be acceptable to employees if their unemployment benefits during a period of layoff would be less than the reduced pay.
Furloughs. Employers can require employees to take unpaid time off—either a few days or a full week or more. In the absence of a state law to the contrary, employers may allow or require furloughed employees to use vacation or PTO time. Sometimes, employers will temporarily shut down a facility, thereby saving not only wages but energy and other administrative costs as well.
Caution: Work sharing, reduced pay, furloughs, and shutdowns may jeopardize employees' exempt status. Exempt employees are not subject to minimum wage and overtime laws. Under federal law, exempt employees must be paid on a salary basis, at a minimum of $455 per week (some states require higher minimum salaries). They must be paid the same salary if they work any part of a workweek, regardless of the quantity or quality of their work.
Because exempt employees must be paid on a salary basis, work sharing is not an option for these employees. Once an employee is paid hourly, he or she can no longer be classified as exempt.
Instituting a furlough or temporary shutdown without jeopardizing an employee's exempt status can be particularly challenging for employers. However, if an employer sets up a weeklong furlough or shutdown and does not pay exempt employees, there is no risk of losing the employees’ exempt status. This is because the wage and hour regulations provide that exempt employees need not be paid for any workweek in which they perform no work. On the other hand, if an employee sets up a partial-week furlough and deducts the pay of exempt employees for the furlough days, those employees are at risk of losing their exempt status and may be entitled to overtime.
Also, it is critical that employees perform no work at all during a furlough or shutdown, including checking work e-mails, making business phone calls, etc. Remember, nonexempt employees must be paid for hours worked, and as noted above, exempt employees must be paid their full salary for any week in which they perform any work. To ensure that no work is performed during a furlough or shutdown, many employers require employees to turn in their personal digital assistants, laptops, and other employer-owned communication devices before they leave. Please see the national Exempt Personnel section.
Reduced benefits. Sometimes, employers can cut costs by reducing employee benefits. For example, employers may eliminate or reduce their contribution to employees' 401(k) plans. Employers' options in this area may be limited if there is a union contract or other employment contract in place. Employers must also make sure that they comply with the requirements of ERISA. Please see the national ERISA section.
Early retirement. Employers can reduce their workforce by offering attractive incentives to employees who are about to reach retirement age. The advantage of retirement incentives is that they allow employers to cut costs without requiring employees to leave their jobs involuntarily. However, the employer may lose some employees it would prefer to keep.
Employers need to be aware of other considerations when laying off employees, whether or not the requirements of the WARN Act apply.
Employers should always avoid unlawful discrimination when considering layoffs. Each layoff decision should be made according to objective, business-related criteria and be well-documented. Layoffs following seniority are generally not considered discriminatory under the federal Civil Rights Act.
Once an employer has determined that a layoff is necessary, it should identify the supervisors who will facilitate the layoff. These supervisors should be directed to select employees for layoff on the basis of nondiscriminatory criteria such as job performance, employee skills, or seniority. Additionally, the selection should be made with any policies or employment contracts in mind. Note that the EEOC has stated that if productivity is a layoff criterion, disabled employees cannot be penalized if their productivity has been negatively impacted as a result of an accommodation.
After the employees have been selected for layoff, a statistical analysis should be done to determine if the layoff would have a disparate impact on employees within a protected group (race, gender, national origin, workers over the age of 40, etc.). If so, the selections should be reexamined. Remember, the employer may be required to show that a business necessity justifies the criteria that have a disparate impact on a protected group. Please see the National Civil Rights section. Please see the National Age Discrimination section. Please see the National Disabilities (ADA) section.
An employer may lay off an employee who is out of work on short-term disability, even in cases when the leave is qualified under the Family and Medical Leave Act (FMLA). The issue is whether the employee would have been selected for layoff if he or she was not out of work on disability. Therefore, the employer should make sure the reasons for selecting this employee are job-related and well documented. In addition, if this is the only employee selected for layoff in a unit or at a facility and there are others in similar jobs not being laid off, the employer is vulnerable to a claim that this employee was selected because he or she was exercising rights under the FMLA, workers' compensation, or other leave law.
Employers instituting layoffs must be particularly careful if they employ foreign workers. Depending on the type of visa, employers may need to notify the Department of Labor or the U.S. Citizenship and Immigration Service of layoffs, reduced hours, or reduced pay. For example, if an employee with an H-1B visa (for persons with special areas of expertise, such as engineers and computer scientists) is paid less than the amount indicated on his or her Labor Condition Application, the employer may be liable for back pay and civil penalties. If an H-1B worker is discharged as part of a layoff, the employer may be responsible for the worker's transportation home.
There are several different types of visas for foreign workers, each with its own rules and regulations. Therefore, employers with foreign workers should consult with experienced counsel when considering a layoff that will include foreign workers. Please see the national Visas section.
The Consolidated Omnibus Budget Reconciliation Act (COBRA) requires employers with 20 or more employees to offer continued group health insurance after terminations for any of a number of reasons, including some layoffs. State continuation laws may provide additional rights. Please see the national Health Insurance Continuation/COBRA section.
Please see the state Health Care Insurance section.
As a matter of goodwill, some companies provide outplacement services to laid-off employees. Outplacement counseling is designed to help terminated employees prepare themselves for a new job or a new career, to lend assistance in providing outside resources, to receive training, and to help employees cope with the stress of leaving the company. Outplacement services include assistance in rewriting resumes, job placements, career counseling, conducting employee skill surveys, and providing pre-layoff employment service registration. Larger organizations may hire outplacement services to assist employees, whereas smaller organizations may hire a single counselor or use existing resources to assist employees. Employers should consider providing outplacement services if employees have been working at the same company for a long period of time and may not have the tools necessary to successfully find another job.
Severance benefits are payments made to employees upon termination of employment caused by events that are beyond their control, such as workforce reductions, plant closings, company takeovers, and mergers. Severance benefits are not required by federal law and are only required by a handful of states. However, many companies do offer severance pay. The payments themselves may be paid in a lump sum or over a period of time. These benefits are usually calculated by the employee's length of service with the company (e.g., 1 week of severance pay given for every year employed with the company). Please see the national Severance Pay section.
Most states have laws regarding when final paychecks must be given to terminated employees. Some states specify when laid-off employees must be paid. Employers need to make sure that they are aware of these laws when conducting a layoff.
Please see the state state Paychecks section.
Regulations issued under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) specifically address an employer's obligations in the event of a layoff or reduction in force. The regulations provide:
• If an employee is laid off with recall rights, he or she is still an employee for purposes of USERRA. If the employee is on layoff and begins service in the uniformed services or is laid off while performing service, he or she may be entitled to reemployment on return if the employer would have recalled the employee to employment during the period of service.
• If the employee is sent a recall notice during a period of service in the uniformed services and cannot resume the position of employment because of the service, he or she remains an employee for purposes of USERRA. As a result, if the employee is otherwise eligible, he or she is entitled to reemployment following the conclusion of the period of service even if he or she did not respond to the recall notice.
• If the employee is laid off before or during service in the uniformed services, and the employer would not have recalled him or her during that period of service, the employee is not entitled to reemployment following the period of service simply because he or she is a covered employee. This is because reemployment rights under USERRA cannot put the employee in a better position than if he or she had remained in civilian employment (20 CFR Part 1002.42). Please see the national Military Service (USERRA) section.
Shortly after a layoff is completed, management should inform remaining employees why the layoffs were necessary. An employer's honesty will be appreciated by employees; if further layoffs are possible, say so. Additionally, employers should acknowledge the extra effort that may be required of the remaining employees.
Layoff survivors may be experiencing a range of sometimes conflicting emotions such as relief, guilt, insecurity, distrust of management, anxiety, and a lack of motivation. It is important for employers to make sure that layoff survivors know that they are valued employees and to help them stay engaged and productive. Managers should be available to discuss the concerns of layoff survivors. In some situations, it may be appropriate to refer layoff survivors to the organization's employee assistance program.
A collective bargaining agreement may mandate the order of rehiring after a layoff. Otherwise, employers usually rehire employees in reverse order of layoff. Problems may arise if employers rehire out of order, if employees choose to remain on layoff status rather than accept a lower-paying job, or if employees are kept on recall status for too long a period of time. Employers may want to limit the eligibility period for rehiring. Staying in touch with laid-off employees and establishing clear procedures for recall and reporting back to work will help the rehiring process run more smoothly.
Effective July 1, 2015, the Workforce Innovation and Opportunity Act (WIOA) supersedes the Workforce Investment Act of 1998 (WIA). Like its predecessor, the WIOA is a federal workforce development law that provides for state and federal employment, education, job-training, and support services. The law is designed to help jobseekers access employment, education, training, and support services and to match employers with the skilled workers they need.
The new act streamlines the programs created by the WIA to provide better value, coordination, and outreach. For example, the new law integrates reporting systems and applies a single set of accountability metrics to all federal programs under the act. States and local programs will be afforded more flexibility to address specific workforce needs, while also being required to develop comprehensive state plans to reduce administrative costs and streamline reporting requirements. Existing programs will be better aligned with "real-world" workplace and educational needs and opportunities.
As with its predecessor, the WIOA will differ in how it is implemented in each state, and state programs will be given ample time to adjust their current programs to conform to the requirements of the new law.
Additional information on WIOA implementation, including links to guidance, technical assistance events, and tools, will be posted on the Employment and Training Administration's WIOA Resource Page at www.doleta.gov/WIOA as it becomes available.
Like its predecessor, the WIOA is intended to develop strong regional economies. In line with this goal, state and local governments have primary responsibility for implementing all programs. State governors must designate local workforce investment areas and oversee local workforce investment boards.
As part of the new act, governors will be required to evaluate existing state programs to ensure that they provide an integrated, effective, and job-driven workforce and training system. State officials have been asked to review existing programs with the following goals in mind:
• Work up front with employers to determine local or regional hiring needs and design training programs that are responsive to those needs;
• Offer work-based learning opportunities with employers—including on-the-job training, internships, and preapprenticeships as training paths to employment;
• Make better use of data to drive accountability, inform what programs are offered and what is taught, and offer user-friendly information for jobseekers to choose what programs and pathways work for them and are likely to result in a job;
• Measure and evaluate employment and earnings outcomes;
• Promote a seamless progression from one educational stepping stone to another, and across work-based training and education, so individuals' efforts result in progress;
• Break down barriers to accessing job-driven training and hiring for any American who is willing to work, including access to supportive services and relevant guidance; and
• Create regional collaborations among American Job Centers, education institutions, labor, and nonprofits.
American Job Center "One Stop" Approach. The cornerstone of the WIA was the "One Stop" service delivery system, which was designed to make information about and access to a wide array of job training, education, and employment services available for workers and employers at a single neighborhood location. The WIOA will continue to support and further streamline this one-stop career service approach.
Through these one-stop American Job Centers, employers have a single point of contact to provide information about current and future skills their workers need to possess and to list job openings. More information on American Job Centers is available at http://www.careeronestop.org. In addition, a directory of state American Job Center "One Stop" websites is available at http://www.doleta.gov/usworkforce/onestop/onestopmap.cfm.
The Department of Labor has set up a website to answer both employer and employee questions about the WIOA and the WARN Act. The website can be found at http://www.doleta.gov.
Additional information about each state's WIA programs, including youth services, funding, accountability, Job Corps, Veteran's Programs, etc., can be obtained by contacting a state's dislocated worker unit.
Please see the state Layoff , state Training sections.
Last reviewed on October 6, 2014.
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Missouri
Missouri follows the requirements of the federal Worker Adjustment and Retraining Notification Act (WARN Act). The WARN Act imposes restrictions on the way layoffs are handled. It is designed to give employees advance notice of a layoff in order to find another job or to seek retraining in a new occupation and to give the state adequate preparation to assist the affected workers. Comprehensive information on the WARN Act is available. Please see the national Layoff section.
The WARN Act requires employers to notify their state dislocated worker unit when layoffs occur. Employers in Missouri should visit jobs.mo.gov/employer for further details.
The Electronic Mass Claims Filing system is designed to assist employers and their employees during a temporary mass layoff. Employee information provided by the employer allows the Division of Employment Security to quickly and efficiently file unemployment insurance claims. This filing method is available when at least 20 workers become totally unemployed.
To use this filing method, the temporary layoff cannot exceed 8 consecutive weeks. For more information, visit labor.mo.gov/DES.
The Division of Employment Security has instituted the Shared Work Unemployment Compensation Program, which is designed to help employers and employees and is an alternative to layoffs for employers faced with a reduction in available work. It allows an employer to divide the available work or hours of work among a specified group of affected employees in lieu of a layoff, and it allows the employees to receive a portion of their unemployment benefits while working reduced hours.
To participate, an employer must reduce the normal weekly hours of work for an employee in the affected unit by at least 20 percent (but not more than 40 percent) and the plan must apply to at least 10 percent of the employees in the affected unit who meet monetary requirements for regular unemployment compensation. If the plan is approved by the Division, workers who qualify for unemployment benefits would receive both wages and Shared Work benefits. The Shared Work benefits would be that percentage of regular unemployment benefits that matches the reduction described in the employer's plan.
The Division may approve a Shared Work Plan if:
• There is an "affected unit" of three or more employees;
• The normal weekly hours of work and corresponding wages for a participating employee are reduced in the plan by no less than 20 percent and no more than 40 percent;
• The plan applies to at least 10 percent of the employees in the affected unit;
• The plan describes the manner in which the participating employer treats the fringe benefits of each employee in the affected unit; and
• The employer certifies that the implementation of a Shared Work Plan and the resulting reduction in work hours is in lieu of a temporary layoff that would affect at least 10 percent of the employees in the affected unit and that would result in an equivalent reduction in work hours.
For more information on the Shared Work Program, including how to obtain an application, see labor.mo.gov/DES.
Additional information is also available on general unemployment compensation matters.
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