New Jersey Legislature Passes Bill to Implement Effective Date for NJ WARN Act Requiring 90-Day Notice and Severance Pay

New Jersey has passed a bill to accelerate the effective date of amendments to the Millville Dallas Airmotive Plant Job Loss Notification Act ("NJ WARN") passed in January 2020, which were originally scheduled to take effect on July 19, 2020, but were indefinitely delayed due to the COVID-19 pandemic. As reported in our prior client alert, the effective date for the January 2020 amendments was postponed so that they would not go into effect until the 90th day following the termination of Governor Murphy's March 9, 2020, Executive Order 103, which declared a public health emergency and state of emergency in New Jersey. In addition, mass layoffs resulting from a natural disaster or national emergency (such as COVID-19) were exempted from coverage under NJ WARN. Under the new bill, which has been passed by both the NJ Senate and the NJ Assembly, the January 2020 amendments will go into effect 90 days after the bill is signed by Governor Murphy, even if the state of emergency remains in effect.

As reported in our original client alert on the amendments, the January 2020 amendments made several significant changes, including:

• The NJ WARN Act will cover all employers with 100 or more employees (including employees outside the state), regardless of how many are "full-time" or "part-time" (as long as the employer has operated in New Jersey for more than three years).
• Employers will have to provide notice of a workplace shut down or mass layoff at least 90 days in advance of the event (up from the previous 60 days).
• Most significantly, employers will also be required to provide all terminated employees severance pay equal to one week of pay for each full year of employment, making New Jersey the first state to require severance pay in addition to notice. If the employer fails to provide the full 90 days' notice, it will have to pay employees an additional four weeks of severance.
• The amended law lowers the threshold for an NJ WARN event so that the 90-day notice and severance pay will be required when (i) an employer terminates or transfers its operations in an "establishment" during any continuous 30-day period (or during a 90-day aggregation period) that results in the termination of 50 or more employees (either full- or part-time); or (ii) the employer conducts a "mass layoff" – defined as a reduction in force (not the result of a transfer or termination of operations) that results in the termination of 50 or more employees (either full- or part-time), at any group of locations within New Jersey, including employees who "report to" any location in New Jersey (removing the requirement that the terminated employees comprise at least 33% of workforce).
• The amendments also include a change to the definition of "establishment," which will now include either a single site of employment in New Jersey or a group of locations within New Jersey, which do not need to be contiguous (e.g., terminations are not counted separately at different sites of employment).
• Employees may not waive their right to severance without approval by the Commissioner or a court of competent jurisdiction.

Governor Murphy has not yet stated whether he will sign the new law before the end of 2022. DWT will continue to monitor the situation and report on any developments.