The New Jersey Business & Industry Association said Thursday a plan to change the state’s tough WARN Notice Law to require that employers provide 90 days’ notice, plus severance pay, whenever they lay off 50 or more workers, will deter companies from locating or expanding in New Jersey.

The bill, S-3170, is scheduled to be considered by the Senate Commerce Committee on Thursday afternoon. Under this legislation, the 2007 WARN Notice Law would be changed to require 90 days’ notice, instead of the current 60 days, and for the first time require affected employers who have followed the notification rules to provide severance pay as well.

Padlock on a chain link fence with factory after layoff notices in the background

Under current law, noncompliance penalties are severe, requiring employers to pay each worker one week of wages for every year he or she has worked for the employer.  S-3170, however, would impose that same penalty on employers even if they have followed a new 90-day notification requirement.

“This legislation is going to deter companies from even considering locating in New Jersey,” said NJBIA Vice President of Government Affairs Michael Wallace. “If enacted, this proposal would make our business climate even less competitive, as it comes after the enactment of a series of tax increases and expensive mandates imposed on employers during the past year, including a higher corporate business tax, higher state income tax, new paid sick leave requirements and the signing of a $15 minimum wage.” The WARN Notice Law applies to New Jersey employers with 100 or more employees that intend to lay off or terminate 50 or more full-time employees within a 30-day period.  The law does not exempt faltering businesses or bankruptcies, providing exemptions only when plant closings are caused by fire, flood, natural disaster, national emergency, war, civil disorder or industrial sabotage.

11 responses to “Proposed Changes to Layoff Notices Law Will Drive Away Businesses”

  1. Lynn says:

    This state making it impossible to operate a business. More and more businesses will leave if this is enacted. Large companies already make it difficult for their smaller suppliers and if this comes into play large companies will just destroy smaller suppliers as they try to claw back losses through reducing budgets and squeezing prices so low. Does no one ever think about the downstream consequences?

  2. Robert D. Herpst says:

    This is the kind of stuff I used to run into in Latin America. It got to the point that it was so expensive to fire long time non productive employees in Brazil, for example, that employers simply endured them and closeted them away where they could do the least harm. It was a huge disincentive to efficient allocation of capital and to hiring younger people. That seems to be where we are headed. Many employers do this voluntarily, but if the business is in such bad straits that it cannot afford to keep its doors open where does the funding for this benefit come from if the business is not part of a much larger enterprise?

  3. MERVET YOUNES says:

    Senate Commerce Committee should run a small business for one week then decide if their decisions make any sense!
    May be we should hand them the keys to our business !

    • LARRY says:

      They would go bankrupt in record time. Example courzine after he left office totally destroyed the next company.
      If these incompetent morons can’t raise taxes to pay for nonsense they would just sh!&.

  4. Stephen Hanft says:

    I happen to agree with this legislation. I was a PathMark employee from 2002-2011. PathMark filed for bankruptcy in 2010. We received the sad announcement in February 2011 that my store was going to close. Because of the 60 day WARN law, our closing date would be in April. Since I was non-union, I could not get a transfer and the company would not help me find another job. Although I fortunately did get another job at Stop&Shop, it would’ve been so much better for me and other employees who were facing lay-offs to have an extra 30 days/month to find another job.

    • Stephen Hanft says:

      Here’s one more thing I almost forgot: In 2011, I called my company’s home office and asked about severance pay. They told me I wasn’t eligible and refused to give me any. I worked for that company and store for 8 1/2 years. I was a hard-working, dedicated, loyal employee. Them not giving me severance pay was an absolute disgrace. It would’ve been the right thing to do and the very least they should’ve done. So, if this bill requires that every laying-off employee must receive severance pay, I fully support it.

      • Larry says:

        Sorry to inform you but if a company goes belly up and is insolvent, like pathmark, you would have still gotten screwed

  5. Brian says:

    New Jersey can not pay its own bills and can’t run a state budget what makes them think they can run a business there killing all business big and small

  6. Thomas says:

    New Jersey is setting minimum wages, defining a safe work environment, setting parameters for personal time off, maternity leave, firing & layoff guidelines, requiring various fees & licenses, taxes any profits, and the list goes on. Why don’t we just say the state is a business partner that rakes in the benefits without the stress & risks.