A month ago, publisher Sandvik AS abruptly informed 125 new employees in Danbury that it would be shutting down a book-sales division it acquired late last year from Scholastic Inc., with layoffs slated to commence in mid-October.
If the facility were located a few miles west, two-months would not have been sufficient notice.
Nearing its 20th anniversary next February, the federal Worker Adjustment and Retraining Notification Act is designed to give state agencies and labor unions sufficient notice to help workers in mass layoffs find new jobs ”“ in the case of the Connecticut Department of Labor, a “rapid response unit” based in Wethersfield.
New York Gov. David Paterson recently signed into law a stiffened version of the WARN Act, requiring employers to give 90 days notice of any mass layoff involving 50 or more workers, a month more than the 60-day federal mandate.
Connecticut state Sen. Edith Prague declined comment on whether Connecticut might reassess its own WARN Act rules, citing uncertainty in the upcoming election.
According to the U.S. Department of Labor, mass layoffs shot from three events in the first quarter affecting 320 workers in Connecticut, to 22 in the second quarter impacting 3,200 jobs.
To date in 2008, companies have filed more than 30 WARN notices in Connecticut, including Fairfield-based General Electric Co. which warned of the closure of a Plainville plant at a cost of 50 jobs. Other companies filing notices have included:
Ӣ Bear Naked Inc. in Norwalk and Stamford;
Ӣ Continental AFA in Bridgeport;
Ӣ Durham School Services in Trumbull;
Ӣ First Student in Danbury
Ӣ New Coleman Park nursing home in Bridgeport;
Ӣ Pitney Bowes Inc. in Newtown;
Ӣ Virgin Atlantic Airways Ltd. in Norwalk; and
Ӣ Watson Laboratories Inc. in Danbury.
The federal law generally applies to layoffs affecting 100 workers, except in cases where a facility closure occurs, in which case the law is triggered by 50 job terminations.
The New York State Department of Labor now has the authority to order back pay and medical benefits for employees who do not receive sufficient notice, as well as to levy a $500 fine per day.
Some employers have been leery of the law, fearing negative repercussions such as a flash flood of workers compensation claims for minor or nonexistent injuries in the final weeks on the job, or even outright sabotage by disgruntled workers.
Federal law allows for a few exceptions for WARN notification. Faltering companies that are attempting to raise capital to remain open are freed from WARN, on the theory that could jeopardize their fundraising efforts. Businesses that are hit by unforeseeable business circumstances or natural disasters are also spared from having to toe the line.
The U.S. Department of Labor has no enforcement power; under federal law, workers are entitled to seek the same remedy, but must do so through the U.S. court system, a possible disincentive due to the time and expense of legal actions.
Still, the state of Connecticut has pursued back wages under the WARN statute, including in 2001 when it went after Walker Digital, which spun out Norwalk-based Priceline.com Inc. After Walker Digital abruptly laid off 100 workers, Attorney General Richard Blumenthal sued demanding $1 million in back wages, settling the following year for a quarter of that amount.
