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Warn Notice Threshold for Construction Workers Based on Worksite, Not Headquarters

    Client Alerts
  • September 21, 2007

Under the Worker Adjustment and Retraining Notification Act (“WARN”), employers must provide 60 days advance notice of a plant closing or mass layoff that occurs at any affected worksite.  In most situations, the concept of the worksite is relatively straightforward.  It is a factory, retail or office location where the employees perform all work services.  How does the employer determine if WARN notice is required in situations where the workforce is transitory, moving from worksite to worksite over time?  In Bader v. Northern Line Layers, the Ninth Circuit Court of Appeals recently concluded that the thresholds for WARN notice are tied to the employees’ worksite at the time of the qualifying employment action.


In this case, the plaintiffs were among 33 employees of the defendant who worked at a Montana  Overall, the employer had several hundred employees, including a headquarters staff in Montana with about 30 employees.  When the defendant laid off all employees at the construction site as well as a large portion of the headquarters staff, a number of terminated employees sued, alleging that they had not been provided adequate advance notice under WARN.  The district court dismissed the complaint, agreeing with the employer’s assertion that it did not have to provide WARN notice because the mass layoff affected less than the 50 employee threshold at any one worksite under WARN. construction site.


The Ninth Circuit affirmed summary judgment for the defendant.  The court rejected the plaintiffs’ contention that the Montana headquarters and construction site were a single site of employment under WARN.  The Ninth Circuit deferred to Department of Labor regulations under WARN, that state that separate physical sites of employment generally are not aggregated for purposes of determining whether an employment action requires notice under the Act.  Even though both locations were in Billings, the construction employees never reported to the headquarters office, and periodically worked at projects across the U.S.  The construction site managed its own day-to-day operations, and these were not controlled by headquarters.  Administrative functions performed by the headquarters office such as billing and payroll were not enough to make the two locations a single employment site under WARN.


In some circumstances, employees who do not physically work at a headquarters location will be counted among its employees for WARN purposes.  For example, a traveling salesperson who works on the road, but who is directed by and who occasionally works out of the home office will generally be counted as employed at that worksite.  For truly multi-site employers, however, WARN determinations will be made based on employees at each distinct physical location.