New Jersey recently enacted a new law that imposes rigorous requirements on certain employers conducting mass layoffs or plant closures at New Jersey worksites. The Millville Dallas Airmotive Plant Job Loss Notification Act (the “New Jersey Act”), became effective on December 20, 2007, and requires employers to provide 60 days notice prior to any “mass layoff,” “transfer of operations,” or “termination of operations.”
New Jersey joins an increasing number of states that have adopted state laws that are modeled after the federal Worker Adjustment Retraining Notification Act (“WARN”), 29 U.S.C. § 2101 et seq. Like the federal law, the New Jersey Act requires employers to give 60 days notice prior to any “plant closing” or “mass layoff.” Notice must be provided to (i) affected employees, (ii) any collective bargaining units at the establishment, (iii) the Commissioner of Labor and Workforce Development, and (iv) the chief elected official of the municipality where the establishment is located. The notice must include:
- a statement of the number of employees whose employment will be terminated, the date on which the transfer or termination of operations or mass layoff will occur, and the date on which each termination of employment will occur;
- a statement of the reasons for the transfer or termination of operations or mass layoff;
- a statement and certain information regarding employment available to employees at any other establishment operated by the employer;
- a statement of any employee rights regarding wages, severance pay, benefits, pension, or other terms of employment as they relate to the termination of employment;
- a disclosure of the amount of severance pay that is payable as a penalty for failure to provide the required 60 days’ notice;
- a statement of the employees’ right to receive information, referral, and counseling from the Department of Labor and Workforce
Development’s response team (discussed in the next section).
The employer is required to provide the notice on a form to be developed by the Commissioner of Labor and Workforce Development, which is required to be available by March 19, 2008.
The New Jersey Act applies to “terminations” or “transfers” of operations that result in the permanent or temporary shut down of a single establishment, or one or more facilities or operating units within a single establishment, that results in the termination of employment of 50 or more fulltime employees during any 30-day period. The New Jersey Act, however, defines an “establishment” to exclude facilities that have not yet been operated by the employer for at least three years. A “mass layoff” is a reduction in force that is not the result of a transfer or termination of operations, but still results in the termination of employment at an establishment during any 30-day period of 500 or more fulltime employees, or 50 or more fulltime employees representing at least one-third of the fulltime employees at the establishment. Similar to WARN, the New Jersey Act provides a 90-day window for potentially aggregating two or more group terminations.
There are some significant differences between the New Jersey Act and the federal WARN Act. The New Jersey Act provides far more significant penalties for failure to comply with the notice provisions. An employer who fails to provide an employee with 60 days notice is required to pay the employee a week’s worth of wages for each year the employee worked for the employer. This payment is in addition to any other severance pay that the employer is obligated to provide the employee. Moreover, the New Jersey Act does not expressly reduce the penalty for partial compliance. Another important difference is that, unlike the federal WARN Act, the New Jersey Act does not have exemptions for faltering or bankrupt businesses.