WARN Act Texas - What You Need to Know

Introduction

The Workers Adjustment and Retraining Notification (WARN) Act as we know it is a federal law put in place to protect U.S citizens from unforeseen mass layoffs and plant closures. The WARN Act differs across states with additional clauses put in place to strengthen accountability, through measures such as continued access to health benefits plans. The WARN Act in Texas ,however, relies solely on the government mandated WARN Act. Therefore, in this blog we will offer a refresher on the provisions put in place under the WARN Act.

Requirements under the Texas WARN Act 

By law, employees are protected under the WARN Act following the circumstances below:

1 - Plant Closure

This refers to the closure of a facility or an operating unit within a single site of employment. A minimum of 50 full-time workers must have been laid off to be covered under the WARN Act.

2 - Mass Layoff

This is where an employer lays off full time employees at a single site of employment. For it to be classified as a mass layoff covered under the WARN Act, the employer has to have laid off between 50-499 employees, if they represent 33% of the active labor. Alternatively the lay off of 500 or more employees excluding part time employees. 

However, it is important to note that not all companies fit the criteria for protected establishments. In order for the employees of a given organization to be protected, the organization must fulfill the one of the following requirements:

1. A business with 100 or more full time employees. This does not include employees with less than 6 months on the job. 
2. A business with 100 or more employees who work a minimum of 4,000 hours a week combined. The outlined business must be a private for profit business, private non-profit organization or quasi-public entity separately organized from the regular government.

If your company fulfills any of the outlined requirements, you are entitled to a written notice 60 days before the date of the mass layoff or plant closure. 

In the event, your employer violates the terms of the WARN Act, you are eligible to seek damages for pay back and benefits for up to 60 days. 

What the Notice Must Contain 

The Notice must include:

1. An explanation on whether the layoff is permanent or temporary (6 months or less).
2. The date of layoff or closing and your expected date of departure. Please note the date of your separation must be 60 days before the first day of the given period. 
3. The name and contact information of a person within the company that can provide additional information if need be. 
4. An explanation of bumping rights and if they exist. Bumping rights refers to a system put in place to provide for an employee to displace another employee as defined in a collective bargaining agreement. They are often based on seniority. 

Exclusions to the WARN Act

If you fall under the following subcategories, you are not protected by the WARN Act. 

1. Employees contracted under temporary projects. 
2. Strikers or workers locked out in a labor dispute.
3. Regular federal, state or local government employees.
4. Business partners, consultants, or contract employees assigned to a given business but have separate employment or are self employed. 

WARN Act Texas Data Trends 

Data from the Texas Workforce Commission reveals a decline in layoffs, in the year 2023. This comes as no shock especially with the pandemic of 2022. Find below a graph curated by the Federal Reserve Bank of Dallas.

The graphs reveal a steady increase in layoffs, a change from the continued decline as observed in the year 2021 to 2022. 

With the above data only offering insight on layoff patterns as per October of 2023, find below a graph with the most recent WARN Notices, including data in 2024. 

The following data has been obtained from The Texas Workforce Commission

The month of December 2023 holds the record of a whopping 4071 companies putting out WARN Notices.  Announced Notices in the following months of 2024, have since been irregular speaking to the current economic instability. 

Conclusion 

As we draw to a close on our exploration of the WARN Act in Texas, The Texas Workforce Commission is a great resource to review. It offers an in-depth explanation including, exceptions to employers, a glossary of terms and updated documents with WARN Act notices. Ensure to give the website a peak and educate yourself on your labor rights.