Wednesday, July 18, 2007
More On WARN Act Reform
Here is an update on WARN Act reform from The Toledo Blade. Toledo is in the middle of the Rust Belt, so local concern about blue collar layoffs might enhance The Blade's interest in this issue. However, although "Congress designed the WARN Act largely to assist blue-collar workers who were losing their factory jobs", it's a different world now, and "with major changes in the U.S. economy over the last two decades, the victims of sudden company closings and major layoffs have spread from blue-collar workers to white-collar employees." Marcus Courtney, head of the IT workers' union WashTech, recently testified in Congress about the need to "beef up" the WARN Act to help workers. He said, "One of the shocks for the service workers is they call me and say, 'I lost my job and everybody lost their job without notice. Isn’t this against the law?' It’s a huge shock to white-collar workers."
Corporations use many tactics to justify violating the law. "Employers often claim that the WARN Act shouldn’t apply to their business because their layoffs were caused by a business circumstance they couldn’t predict or they were in the process of negotiating with lenders," The Blade reports. "These common defenses often slow the litigation process and delay any damages that would be received by workers." Another tactic is to deliberately spread layoffs out over time to avoid hitting the trigger minimum that necessitates giving 60 days notice to employees. Such legal experts claim that a "bad faith" penalty should be applied to employers like these who knowingly violate the law, as opposed to those who might be construed to have a valid excuse.
Barack Obama is among those supporting WARN Act reform. "As we work to restore America’s competitiveness and revive our manufacturing sector, we must also ensure that workers have the skills and training they need to perform their jobs in today’s economy,” he said. “We must give the WARN Act teeth, to ensure that workers are not left in the lurch without a job or a paycheck."
Here's a list of some of the key reform proposals (as quoted by The Blade):
1) Lowering employee thresholds so more employers would be covered by the law and requiring businesses to provide notice if they lay off a large number of employees or shut down.
2) Increasing the notice time from 60 days to 90 days or even six months to give workers more time to adjust and to provide additional time for the business to examine options to save jobs.
3) Giving the Department of Labor the responsibility to enforce the law, while preserving the right of workers to hire attorneys if the government does not act.
4) Boosting the penalties to provide a steeper consequence for employers that violate the law and punish employers that purposefully break it.
"Reform overdue, WARN Act critics say; worker advocates look to eliminate flaws, loopholes in federal law" from The Toledo Blade