Law360 Quotes Partner Jill Kahn Marshall on WARN Act Case
Last spring, allegedly due to decreased business resulting from the COVID-19 pandemic, car rental company giant Enterprise laid off hundreds of employees in Florida. The company did so with little or no notice to many of its employees, although the federal Worker Adjustment and Retraining Notification Act (WARN Act) explicitly requires companies with at least 100 employees that terminate more than 50 employees at once to provide at least 60 days’ notice. Enterprise employees brought a proposed class action against the company in federal court in Florida for violation of the WARN Act. In denying Enterprise’s motion to dismiss, U.S. District Judge Roy B. Dalton ruled that the “unforeseeable business circumstance” exception may be available to Enterprise, but it was still not clear whether the company had provided “as much notice as is practicable,” as required.
On January 11, Law360 published an article on the topic entitled, “Enterprise WARN Act Ruling Spells Trouble For Big Employers“ which featured Partner Jill Kahn Marshall. Jill states regarding Judge Dalton’s ruling, “It doesn’t have any binding effect on other district courts throughout the country, but I do think when there’s a new issue, courts like to look at other opinions to see how they analyzed it.”
Enterprise attempted to get this case dismissed by citing two exceptions to the WARN Act’s notice requirements. First, businesses may terminate employees without advance warning in the event of “any form of natural disaster, such as a flood, earthquake, or the drought currently ravaging the farmlands of the United States.” Second, the “unforeseeable business circumstances” exception states that employers only need to give as much notice “as is practicable” should there be a “sudden, dramatic and unexpected action or condition outside the employer’s control.” Judge Dalton found that the natural disaster exception was inapplicable, where the Department of Labor did not discuss the exception in its WARN Act guidance related to COVID-19. Jill states, “I agreed with his reasoning. The fact that DOL guidance on COVID-19 and the WARN Act doesn’t mention the natural disaster exception is pretty telling that that’s likely not what they think is going to apply here. It’s much more likely that it will be the ‘unforeseeable business circumstance’ exception.”
Enterprise’s motion to dismiss was denied, allowing the case proceed. Companies and courts around the country may look to this case to see how the court determines whether sufficient notice was provided under the circumstances.
To learn more, read the full article here.