Understanding the California WARN Act: Employee Rights and Employer Responsibilities in Mass Layoffs

The abrupt loss of a job can be a devastating and life-altering event. While layoffs are sometimes unavoidable in business operations, employees are not entirely without protection. In California, both state and federal laws provide a structured framework to help workers prepare for major employment disruptions. At the center of these protections is the California Worker Adjustment and Retraining Notification (WARN) Act—a statute that imposes legal obligations on employers before they carry out mass layoffs, plant closures, or significant relocations. The law firm California Business Lawyer & Corporate Lawyer regularly assists both employers and employees in understanding their rights and obligations under the state’s complex employment laws.

A WARN notice in California is a formal written notification that an employer must issue at least 60 days in advance of a mass layoff, plant closure, or significant relocation, ensuring affected employees and local agencies are properly informed. This article provides a comprehensive overview of the California WARN Act, its distinctions from the federal WARN Act, the rights it grants to employees, the penalties employers face for non-compliance, and key considerations for both employees and employers navigating layoffs in California.

Overview of WARN Legislation: Federal vs. California

At its core, the WARN Act is designed to ensure that employees are given enough time to prepare for large-scale job losses. This includes time to seek new employment, adjust financially, and in some cases, retrain for a different career path.

The federal WARN Act, enacted in 1988, sets a national standard requiring certain employers to provide at least 60 days’ advance notice to employees and government officials before a large layoff or plant closure. However, individual states have the authority to pass their own, more stringent versions of the law—and California has done just that. The California WARN Act is broader and more inclusive, offering greater protections to a larger group of employees and imposing stricter requirements on employers.

Who Must Comply with the California WARN Act?

The California WARN Act applies to any “covered establishment” that employs—or has employed in the previous year—75 or more full-time or part-time workers. This includes both public and private entities, and both for-profit and nonprofit organizations. Notably, California’s employee threshold is lower than that required by the federal WARN Act, which only applies to employers with 100 or more full-time employees.

This expanded coverage means that a broader swath of workers in California receive advance warning of employment disruptions, including remote employees who are based in California.

Events That Trigger California WARN Act Requirements

Several types of employment actions trigger the requirement for advance notice under the California WARN Act:

1. Mass Layoffs: The layoff of 50 or more employees within a 30-day period at a single location, regardless of what percentage of the total workforce that number represents.
2. Plant Closures: The shutdown of a facility, even if it affects fewer than 50 workers.
3. Relocations: The move of a business operation more than 100 miles away, impacting any number of employees.

These definitions are broader and simpler than those found in the federal WARN Act. For example, the federal act defines a mass layoff as the termination of 500 or more employees, or 50 to 499 employees if they constitute at least 33% of the employer’s workforce.

Notification Requirements Under the California WARN Act

To comply with the law, employers must provide a written notice at least 60 days before the employment action takes place. This notice must be sent to:

• Affected employees
• The California Employment Development Department (EDD)
• The local Workforce Development Board
• The chief elected officials of each city and county where the layoffs or closure will occur

The inclusion of local government entities and workforce boards is an additional requirement under California law, distinguishing it from the federal statute. This broader notification system is designed to help local communities respond proactively to the economic impacts of large-scale job losses.

Employee Rights Under the California WARN Act

When the WARN Act is triggered, affected employees gain several important legal rights. These include:

• Advance Notice: The core provision of the law is the requirement that employees receive 60 days’ written notice before being laid off or affected by a plant closure or relocation.
• Back Pay and Benefits: If the employer fails to provide the required notice, employees are entitled to up to 60 days of back pay and the value of any benefits lost during the violation period. This includes health insurance, retirement contributions, and other fringe benefits.
• Extended Health Coverage: Employers may be required to continue funding health benefits for up to 60 days following a layoff when notice was not properly given.
• Civil Penalties: Employers who fail to meet the notice requirement may also be fined a civil penalty of $500 for each day of violation.
• Attorney’s Fees: In cases where employees take legal action and prevail, they may be reimbursed for legal expenses and attorney’s fees.
• Unemployment Insurance Eligibility: Employees may file for unemployment benefits immediately, even if they are awaiting back pay or other compensation from their employer.
• Relocation Assistance: When a business relocates and significantly impacts employees, relocation support may be required by contract or additional labor law provisions.
• Punitive Damages and Reinstatement: In rare cases where employer conduct is especially harmful or unlawful, courts may award punitive damages or order that employees be reinstated.

These protections are not just theoretical—they have real-world implications for workers blindsided by abrupt job terminations.

Real-Life Examples of WARN Act Violations

To understand how the California WARN Act plays out in practice, consider these examples:

• Mass Layoff Example: A logistics company in California with 150 workers lays off 80 employees over a 30-day period without advance notice. The employer has violated the WARN Act and is liable for 60 days’ worth of compensation and benefits for each affected employee, in addition to civil penalties.
• Plant Closure Example: A manufacturing plant abruptly closes with only two weeks’ notice, leaving long-time employees scrambling. Despite the lower number of impacted workers, the closure still triggers WARN requirements under California law.
• Relocation Example: A Silicon Valley tech firm relocates its operations to another state, giving workers only 30 days’ notice. This relocation exceeds 100 miles and affects numerous employees, violating the WARN Act and making the company liable for penalties and compensation.

These examples illustrate how seriously California takes advance notice requirements, and how costly violations can be for employers.

California WARN Act Exceptions

Despite its comprehensive nature, the California WARN Act allows for several specific exceptions:

• Project-Based Employment: Employees hired for a specific project or assignment (such as in construction or film production) and who knew their job would end at project completion may not be entitled to advance notice.
• Seasonal Workers: Jobs that are inherently seasonal or temporary, such as agricultural labor or holiday retail positions, are generally exempt.
• Natural Disasters or Acts of War: Layoffs due to events beyond the employer’s control, like earthquakes, wildfires, or acts of war, may be exempt from the notice requirement.
• Good Faith Business Efforts: If an employer is actively seeking capital or business to avoid layoffs and reasonably believes that giving notice would jeopardize those efforts, they may qualify for an exception. However, such cases are scrutinized closely by regulators.

Even with these exceptions, employers are advised to consult legal counsel before assuming they are exempt, as misclassification can lead to significant liability.

Remote Employees and WARN Act Coverage

Another common question relates to whether remote employees qualify for WARN Act protections. In California, the answer is yes. If the employee works from home or another remote location but is employed by a company subject to the WARN Act, and if the event triggering WARN requirements (layoff, closure, or relocation) affects them, their rights are protected just the same.

This provision ensures that the growing number of remote workers are not left out of the law’s protections, particularly in a post-pandemic work environment where telecommuting has become standard.

Employer Penalties for Non-Compliance

Employers who fail to follow the California WARN Act face multiple financial penalties:

• Up to 60 days of back pay and benefits for each affected employee
• Civil fines of $500 per day of violation
• Liability for medical expenses incurred during the notice violation period, if those costs would have been covered under the employee’s health plan
• Payment at the employee’s final wage or three-year average wage, whichever is higher

These financial obligations serve as a strong incentive for employers to comply fully with the law. The penalty clock starts ticking the day an employer fails to give notice, making prompt and transparent communication critical during layoff planning.

Best Practices for Employer Compliance

Employers operating in California must take a proactive approach when planning layoffs or closures. Here are several strategies for compliance:

• Understand Both State and Federal Requirements: Know the differences and make sure to follow the more stringent of the two when applicable.
• Consult the EDD: Regularly check the California Employment Development Department’s website for updates on the law.
• Involve Legal Counsel: A company’s legal team should be involved in all stages of the layoff planning process to ensure legal compliance.
• Notify All Required Parties: Include all required recipients in the notice—employees, EDD, local workforce boards, and elected officials.
• Document the Process: Keep detailed records of the notice process in case there is any future dispute about whether or when notice was given.
• Consider Outplacement Services: Offering career transition or retraining support can help employees and bolster the company’s reputation, even during difficult times.

Failing to follow these best practices not only increases legal risk but can also damage a company’s brand and employee morale.

Conclusion: The Role of WARN in Protecting California Workers

The California WARN Act plays a critical role in safeguarding workers from the financial and emotional turmoil of unexpected layoffs and closures. By mandating advance notice and holding employers accountable, the law provides essential stability for individuals, families, and communities.

For employees, understanding your rights under the California WARN Act is the first step in protecting yourself. If you’ve experienced a layoff or business relocation and believe the law was not followed, consulting an experienced employment lawyer can help you determine your eligibility for compensation.

For employers, compliance is not just a legal obligation—it’s a sign of integrity and corporate responsibility. Ensuring that employees are treated fairly during transitions builds trust and protects the organization from costly legal challenges.

In an unpredictable economy, laws like the WARN Act serve as a safety net, giving employees a critical window to plan their next steps and rebuild their lives.