Question: May an employer who is closing a plant pay out employees in lieu of a 60-day Worker Adjustment and Retraining Notification Act (WARN) notice?
Answer: The Worker Adjustment and Retraining Notification Act (WARN) requires a 60-day written notice and does not contain a provision for an alternate option. Best practice is to provide the 60-day notice. While we would not recommend taking the approach of payment in lieu of notice, the Department of Labor does discuss this situation on their website and a link to this information is contained as a source. Please consult with a labor attorney for the best advice to manage this particular situation.
The damages for violating WARN are back pay and benefits up to 60 days. According to the Department of Labor, if an employer paid these amounts but did not provide 60-day notice, while they have technically violated WARN they have also already paid the WARN damages. Keep in mind that employers should be aware that WARN allows for voluntary payments of wages and benefits to be offset against damages awarded for violations of the act. However, if these payments were required by another law, contract, or company policy or practice, the employer cannot use them to offset WARN damages.