New Jersey Governor Signed Law to Exclude COVID-19 Related Mass Layoffs from New Jersey WARN Act and to Delay the Effective Date of Pending Amendments

On April 14, 2020 New Jersey Governor Phil Murphy enacted two amendments to the New Jersey WARN Act (the “NJ WARN Act”) that exclude layoffs due to certain reasons, including those related to COVID-19, and postpone the effective date of pending amendments to the NJ WARN Act that were set to take effect on July 19, 2020.  These new amendments are effective immediately and are retroactive to March 9, 2020.

Exclusion of Mass Layoffs

Under the NJ WARN Act, employers with 100 or more full-time employees must provide 60 days’ advance written notice to employees who will be affected by a mass layoff or transfer or termination of operations.  A mass layoff means the termination of 500 or more full-time employees during a 30-day period or 50 or more full-time employees representing at least one-third of an employer’s total workforce at a single facility, a group of facilities in an office or industrial park, or separate facilities located across the street from each other.

Previously the NJ WARN Act did not provide exceptions to its notice obligations in the event of “mass layoffs” that resulted from natural disasters or national emergencies.  This contrasted with the federal WARN Act which contained exceptions to its notice requirements in the event of natural disasters and unforeseen business circumstances.  The new amendment immediately revises NJ WARN Act’s definition of “mass layoff” to exclude those made necessary by fire, flood, natural disaster, national emergency, act of war, civil disorder or industrial sabotage, license revocation, or decertification from participation in the Medicare and Medicaid programs.

Accordingly, mass layoffs that occurred on or after March 9, 2020 due to the ongoing COVID-19 pandemic do not trigger the notice requirements of the NJ WARN Act.

Delay of Pending Amendments

As previously reported, on January 21, 2020 the New Jersey Governor signed legislation that amended the NJ WARN Act to expand employer notification obligations and require severance payments for employees affected by mass layoffs and transfers or terminations of operations.  These amendments were detailed in our memorandum dated February 19, 2020.  However, the most significant amendments are the following:

• Expansion of notice obligations to all employers with 100 or more employees, including full-time and part-time employees;
• Increase the minimum notice employees must be provided from 60 days to 90 days.
• Amend the definition of mass layoff to mean the termination of 50 or more employees, regardless of full-time or part-time status, at or reporting to a single location or a group of locations, including any facilities located in New Jersey, during a 30-day period.
• Required employers to pay severance payments to affected employees in the amount of one week of pay for each full year of employment, even if proper notice is provided.

These amendments were set to go into effect on July 19, 2020.  However, the newly signed amendment delays the January 21, 2020 amendments’ effective date to 90 days after the New Jersey Governor terminates his Executive Order declaring a public health emergency related to the COVID-19 pandemic.  As of the date of this memorandum, the Executive Order will expire on May 8, 2020, therefore the January 21, 2020 amendments have a tentative effective date of August 6, 2020.  In the event the Executive Order is extended the effective date will be further postponed.

If you have any questions, please do not hesitate to contact David R. Rothfeld, Lois M. Traub, Alexander Soric, Jennifer Schmalz, Jaclyn Ruocco, Joseph Tangredi, Brian Polivy or Robert L. Sacks.

This memo is provided for informational purposes only. It is not intended as legal advice and readers should consult counsel to discuss how these matters relate to their individual circumstances