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Reductions in Force/WARN Act• ReductionsinForce(RIFs)—Planning,Compliance,andImplementation

• WARNAct—WorkforceAnalysis,PracticalAdvice,andNoticePreparation

• AdverseImpactAnalysis—DesignandStatisticalEvaluation

• SeverancePlansandAgreements—PreparationandCompliance

Our RIF/WARN Act Practice Group can guide you through the difficult

choices an employer faces in planning and

implementing reductionsin force and layoffs.

PRACTICE GROUP

Reductions in Force/WARN Act

REDUCTIONS IN FORCE AND LAYOFFS: HOW TO DO THEM RIGHTIsyourbusinessexpandingduetoamerger?Areindustrychangescreatinganeedtoreorganizeandrestructureyourcurrentworkforce?Hasyourbusinesslostalargecontractorhastherebeenasofteningdemandforyourproducts?Allofthesescenarioscancreateaneedforyourbusinesstoreducecostsoraddressredundancies.Howdoyouhandletheseeventsinacost-effectivemannerandstillcomplywiththeoftenvagueandconfusingfederalandstatelawrequirementsformultiple-employeeseparations?

OurRIF/WARNActPracticeGroupcanhelp.Ourattorneyshaveextensiveexperienceworkingwithbusinesses inalmostevery industry.Weareknowledgeable indesigningreduction inforce(RIF)policiesandRIFselectiondocumentstohelpemployersofallsizesdefendagainstdiscrimination claims.Wehave advisednumerous clients on the complex and sometimesambiguousrequirementsoftheWorkerAdjustmentandRetrainingNotification(WARN)ActandtheOlderWorkersBenefitProtectionAct(OWBPA).Inaddition,ourattorneysarewell-versedintheintricaciesoftheEmployeeRetirementIncomeSecurityAct(ERISA)andthefederaltaxcodeandhowtheyaffectRIFs.Wehaveexperiencedesigningvoluntaryandinvoluntaryseverance plans tomeet the requirements of these laws.We can also help ensure thatseverancepackagesandagreementsaddresseachemployer’sparticularneedsandcomplywiththelatestfederalandstatecourtdecisionscoveringmultiple-employeeterminations.

Our services include:• developingastrategicplanfortheRIF,includingpreparingthedocumentsto guideandsupporttheRIFselectionprocessanddraftingseveranceagreements thatcomplywiththerequirementsoftheOWBPA;

• assessingwhetheraRIFtriggersWARNActcoverage(underbothfederalWARN andstate“mini-WARN”Acts),includingdeterminingemployercoverageandthe numberofemployeesaffected,identifyingpart-timeemployeesforpurposesof makingcoveragedecisions,understandingthelegalrequirementscoveringtemporary employeeswhomaybeworkingatimpactedsites,anddefiningthesingle“siteof employment”thatservesasthebasisforanalyzingwhethertheWARNActistriggered;

• determiningandassessingWARN“look-back”and“look-forward”periodsandevents;

• preparingWARN-compliantnoticestoaffectedemployeesandgovernmentofficials;

• conductingstatisticalanalysesofRIFselectiondecisionswithintheattorney-client privilege,whichallowsforafullandfrankdiscussionofthelegalrisksassociated withaRIF;

• preparingOWBPA-compliantdisclosurematerials,includingaddressingchangesin employeestatusbeforeandafterRIFdecisionsaremadeandaddressinginclusion offoreignworkers(andrelatedimmigrationissues)inRIFs;

• preparingmultiple-terminationseveranceandseparationagreementsthatmeet federalandstatestandardsforobtainingvalidreleases;

• assessingforunionizedemployerswhetherthebusinesshasadutytobargain overtheRIFdecisionand/ortheeffecttheRIFwillhaveonthebusinessundera collectivebargainingagreement;

• preparinganERISA-compliantseveranceplantoprovidesignificantsubstantive andproceduraladvantagesintheeventoflitigation;and

• structuringtheseverancepaymentstoreducethelikelihoodofadverse federaltaxconsequences.

WARN ACT: COMBINING COMPLIANCE ADVICE WITH AN UNDERSTANDING OF BUSINESS NEEDS UnderthefederalWARNAct,employersmustgive60days’noticeofacoveredplantclosingoramasslayoff.Soundssimple,right?ThefederalWARNActanditscompanionregulationsappear straightforward, but they are not. Formulti-state employers, the complexityincreasesgiventhatat leastadozenstates—includingCalifornia,NewYork,and Illinois—have“mini-WARNActs”that imposetheirownrequirements forconductingamass layofforplantclosing.Fromdeterminingwhoisanemployee,whosuffersanemploymentloss,andwhatconstitutesasinglesiteofemploymentforstatutorycoveragetohowtoaddressseparatelayoffswithinarolling90-dayperiod,thefederalWARNActanditsstatecounterpartsarefullofchallenging issues.Theseissuesoftenrequireemployerstoleavetherealmofblack-and-whiteanswersandenteragrayareathatrequiresdifficultcost-benefitdecisions.Ourexperiencedlawyerscanassistwiththisanalysis.

Ogletree Deakins is one of the nation’s largest labor and employment law firms, representing management in all types of

employment-related legal matters.

OGLETREE, DEAKINS, NASH, SMOAK & STEWART, P.C.

THE OWBPA: DECISIONS, DECISIONSWhenanemployerconductsaRIF,itusuallywillrequireareleaseandwaiverofclaimsfromemployees selected for theRIF inexchange for severancebenefits. Ifanemployer selectsemployees40yearsofageorolderforaRIFandseeksawaiverandreleasefromtheemployees,theOWBPAkicksin,addinganotherlayerofcomplexitytoanalreadychallengingprocess.

Normally,ifanemployerisdischargingasingleemployee,theemployeeis40orolder,andtheemployerasksforareleaseofclaims,theOWBPArequirestheemployertoincludespecificlanguageinthereleaseandgivetheemployee21daystoconsiderwhethertosignthereleaseand7daystorevoketheagreementaftersigning.WhenaRIFaffectsmorethanoneemployeeandatleastoneofthoseemployeesis40orolder,however,thelawrequiresthesameseriesofstatementsbutgivestheolderemployeemoretimetoconsidertherelease.Moreimportantly,thelawalsorequirestheemployertogivespecificdisclosures—particularlyjobtitles,ages,andeligibilitycriteria—totheolderemployeesaboutallemployeesinthe“decisionalunit”whowereconsideredfortheRIF.

BecausefailingtocomplywithOWBPArequirementscanresultinaninvalidreleaseandexpensiveandtime-consuminglitigation(includingclassactions),itiscriticalthatemployersseekingareleaseofageclaimsaspartofaRIFprovideaccurate,understandableinformationtoolderemployeesaboutwhowasconsideredfortheRIF.OgletreeDeakinsRIF/WARNActattorneyscanguideemployersthroughtheOWBPAmaze,includingdeterminingwhoisconsideredinthe“decisionalunit”andhowtopresentrequireddisclosuresinamannerthatisdefensibleandalignedwiththeRIFdecision-makingprocess.

DRAFTING SEPARATION, SEVERANCE, AND BENEFIT PLANSWhenitcomestodevelopinglegally-compliantseveranceplans,onesizedoesnotfitall.Everyemployerhasadifferentworkforce,benefitsstructure,andbusinessculture—thevariationsareendless.Ourattorneyshelpclientsdecidehowtochoosethecorrectplanbywalkingthemthroughthetoughquestionssuchas:

• WhatbenefitswillyoupaytothoseemployeesselectedtobepartofaRIForwhoelect toterminateemploymentunderavoluntaryRIF?

• Arethebenefitstobepaidpartofanalready-existingseveranceplan,orwilla differentbenefitbeprovidedtothegroupofemployeeswhoarepartofaparticularRIF?

• HowcanyouuseERISAwithitspreemptionofstatelawsandfederalcourtjurisdiction toimproveyourdefensesagainstpossibleclaims?

• CanorshouldyoubesubsidizingCOBRA,andwhatisthebestwaytointegrateany RIFbenefitextensionwithCOBRA?

• WillaRIFresultinunexpectedfundingandreportingobligationsunderyourpensionplan?

WealsocanprovideguidanceonthemostcommonbenefitsprovidedtoRIFparticipants,suchasthelengthandamountofseverancepayandcontinuationofmedicalbenefits,andassistindraftingthenecessarydocuments.

IMMIGRATION ISSUES OurimmigrationlawyerscanguideanemployerincommunicatingwithUnitedStatesCitizenshipand Immigration Services (USCIS) about changes in the termsofemployment,determiningwhethertheemployermustpayforreturntravelforforeignnationalsoncertainvisaswhoarelaidoff,andexplaininghowthelayoffmightimpacttheemployer’sforeignnationalswhoareinvolvedinthegreencardprocess.

With offices across the United States andin Europe, Canada, and Mexico, the firm represents a diverse range of clients.

We operate efficiently without compromising our commitment to service.

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