©2023 Seyfarth Shaw LLP www.seyfarth.com 2023 Cal-Peculiarities | 350 13. Procedural Quirks Regarding Termination of Employment and Post-Termination 13.1 Cal-WARN Act The federal Worker Adjustment and Retraining Notification Act of 19881 requires employers to provide 60 calendar days of notice regarding plant closings and mass layoffs. Not to be outdone, California in 2002 enacted its own WARN act. The scope of Cal-WARN exceeds the scope of federal WARN in two major respects: (1) CalWARN applies to companies that are too small to be covered by WARN, and (2) Cal-WARN applies to business decisions affecting groups of employees that are too small to be covered by WARN. (For a summary of these and other differences between California and federal WARN law, see § 13.1.4.) California employers who implement a mass layoff or relocate or terminate operations at any industrial or commercial facility at which they have employed 75 or more persons within the preceding 12 months must first give the affected employees 60 days of notice. “Employees” includes some temporary and seasonal as well as part-time employees. An “employee” is one who has been employed for at least six of the 12 months preceding the triggering event. A “mass layoff” means a layoff during any 30-day period of 50 or more employees at a covered establishment. A “relocation” is the removal of all or substantially all of the operations at the facility to a different location 100 miles or more away. “Termination” is the cessation or substantial cessation of the operations of the facility. Does the mass transfer of employees from one employer to another, with no other change in the terms and conditions of employment, constitute a “layoff”? One California appellate court has said no: a layoff under Cal-WARN is “a separation from a position for lack of funds or lack of work,”2 and that language did not apply where employees continued to work as they had before.3 The Court of Appeal, upholding a judgment against an employer for more than $200,000, held that “mass layoffs” could include four- to five-week furloughs, even though the term “mass layoff” in the federal WARN statute includes only layoffs that involve employment losses exceeding six months.4 13.1.1 Recipients of notice The notice must go to (a) the affected employees, (b) the EDD, (c) the local workforce investment board, and (d) the chief elected officer of each city and county government within which the triggering event occurs. The notice should also include the elements required under the federal WARN Act.5 13.1.2 Exemptions Cal-WARN exempts employees in the broadcasting, motion picture industries, and certain occupations in the drilling, logging, and mining industries, if those employees were hired with the understanding that their employment was limited to the duration of a particular project. The law also does not apply to those employed in seasonal jobs, if they were hired with the understanding that the job was seasonal and temporary. Before the Covid-19 pandemic, there were three exigent-circumstances exceptions to the law’s requirements. The first was for “physical calamity,” the second was for “act of war,” and the third was for situations where the employer actively seeks capital or business to avoid or postpone a relocation or termination, and where the employer reasonably and in good faith believed that giving 60 days’ notice would preclude the employer from
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