A federal appellate court made it difficult to blame ’20-’21 large layoffs on COVID-19


Days since I’ve blogged about COVID-19 = 78 0.

I promise(ish), this one will be interesting. And for those of you with businesses that had a mass layoff or plant closing because of COVID-19, it will be horrifying.

You see, I just got finished reading a Fifth Circuit decision in which the federal appellate court concluded that an employer couldn’t use the “natural disasters” exception to the Worker Adjustment and Retraining Notification Act (WARN) to blame layoffs on COVID-19.

WARN is the federal law that requires employers with 100 or more employees to provide at least 60 calendar days advance written notice of a plant closing and mass layoff at a single employment site.

The WARN Act’s natural-disaster exception provides that “[n]o notice under this chapter shall be required if the plant closing or mass layoff is due to any form of natural disaster, such as a flood, earthquake, or the drought currently ravaging the farmlands of the United States.”

Early last year, I foreshadowed that the “natural disasters” exception might be a long shot anyway. A federal judge in Florida concluded that COVID-19 isn’t a “natural disaster.”

And, yesterday, so did the Fifth Circuit.

The court relied on the “the canon of noscitur a sociis,” which either means “I’ll take two half-smokes with mustard and relish” or “the meaning of an unclear or ambiguous word (as in a statute or contract) should be determined by considering the words with which it is associated in the context.” Probably, the latter.

In doing so, the court reasoned that “the appearance of ‘natural disaster’ in a list with ‘flood, earthquake, or drought’ suggests that Congress intended to limit ‘natural disaster’ to hydrological, geological, and meteorological events.”

And COVID-19 ain’t that.

Although the Fifth Circuit opinion didn’t address it, the “unforeseeable business circumstances” exception would seem to remain available to employers who had mass layoffs and plant closings due to COVID-19. The federal judge in Florida said as much too.

Hopefully, this isn’t something over which you’re clutching those HR pearls. An employer who violates the WARN provisions by ordering a plant closing or mass layoff without providing appropriate notice is liable to each aggrieved employee for an amount including back pay and benefits for the period of violation, up to 60 days.

To mitigate the risk of WARN liability, employers can voluntarily and unconditionally provide 60 days of pay at the separation of employment.

There are many more WARN requirements than you’ll find in this blog post. For more information about WARN, check out these DOL resources, and consult an employment attorney before you terminate employment.

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