Authors: Attorney John C. Mitby and Attorney Elizabeth L. Spencer
Phone: 608-257-0945
Email: jmitby@hurleyburish.com, espencer@hurleyburish.com

As employers continue to cope with the
consequences of the coronavirus (COVID-19) global pandemic they may face the
unfortunate decision of having to engage in mass layoffs of employees or close
their business entirely. Wisconsin employers need to be aware of the
requirements imposed by both state and federal law in these situations. While
the law in this area is complicated by numerous exceptions based on the
circumstances of the layoff and the employer type, knowing the basics can put
you on alert for what further action you may be required to take.

The
federal Worker Adjustment and Retraining Notification (WARN) Act requires
employers with 100 or more full-time
employees, excluding employees who have worked less than 6 months and those
working less than 20 hours per week, to provide 60 days notice of an
“employment loss” if there is a “plant closing” or a “mass layoff” impacting 50
or more employees at a single site of employment OR those who employ 100 or
more workers working at least a combined 4,000 hours per week. WARN looks at
the employment losses that occur over a 90-day period, thus the layoffs may be
staggered to let go smaller number of employees but still require a notice. The
Act effects employers who are is private for-profit business, private
non-profit organization, or quasi-public entity separately organized from
regular government. While the contains numerous exceptions it notably includes
an exception for “an unanticipated and dramatic major economic downturn might
be considered a business circumstance that is not reasonably foreseeable.” It
is not known how of if this exception will be applied to COVID-19 layoffs or
closings.

In
Wisconsin Section 109.07 of the Wisconsin Statutes and Chapter DWD 279 of the
Wisconsin Administrative Code combine to create Wisconsin’s Business Closing
and Mass Layoff (WBCML) Law. The WBCML is broader than WARN and applies to
employers with 50 or more employees.  To
be covered by the WBCML the employer must also be permanently or temporarily
shutting down an employment site, facility, or operating unit within a single
municipality that affects 25 or more employees OR be reducing the number of its
employees by: at least 25% of its workforce or 25 employees, whichever is
greater, or by at least 500 employees. THE WBCML provides exceptions for unforeseeable
business circumstances and natural or man-made disasters beyond the employer’s
control. However, it is not known how of if this exception will be applied to
COVID-19 layoffs or closings.

The
consequences of COVID-19 are an ever-developing issue with states often
suspending administrative code and statutes or enacting new acts to cope with
the changing climate. Some states, such as California, have already suspended
their 60-day notice requirement. Wisconsin has already made adjustment to its
unemployment benefits so it is possible that adjustments related to the WBCML
may not be far off.  Contact an attorney or
see the Wisconsin Department of Workforce Development’s information on notices
at:

https://dwd.wisconsin.gov/dislocatedworker/employer/tools/notice/

 If you plan to close your business or lay off employees to ensure you are acting in accordance with applicable law.