Minimizing labor costs through layoffs is often a difficult but necessary choice for businesses facing uncertain economic times. Unfortunately, companies are often reluctant to begin the process until the need is dire.
Rushing a layoff can easily lead to costly oversights that greatly increase the likelihood of employment-related litigation. By preparing early and proceeding carefully, companies may be able to mitigate that risk.
1. Check local and federal WARN requirements
The federal Worker Adjustment Retraining Notification Act requires most employers with a certain number of employees to give workers, unions and relevant government agencies notice well in advance of a mass layoff. Additionally, in Pennsylvania, some municipalities have their own WARN acts with different specific requirements.
2. Develop objective selection criteria
Developing and documenting objective, demonstrable criteria for layoff selection is critical. Relevant factors employers may consider include seniority, performance reviews, specialized experience or skill sets, the importance of specific positions and past disciplinary actions.
3. Review layoff selections for neutrality
It is important to review layoff selections carefully before moving forward. Ensuring that layoffs will not disproportionally affect a protected group of workers may be crucial for preventing employment discrimination claims.
There are many other issues that employers will need to address when preparing for layoffs. In addition to determining the role of management in the process, the company will have to decide how to communicate selection results to employees. These decisions can present their own legal hazards.
From the initial planning stages to implementation, consulting an employment law attorney may be invaluable in helping to minimize the costs and complications involved in layoff disputes.