Closing shop or reducing your workforce?  New changes in New Jersey now require mandatory severance pay.

On January 21, 2020 the Governor of New Jersey signed Senate Bill 3170, which enlarges the protection of employees subject to mass layoffs by their employer. The new Act applies to employers with at least 100 full or part-time employees.   NJ WARN applies to the termination of 50 or more employees, irrespective of whether they are full or part-time and irrespective of where within the state the employees work.

NJ WARN now requires a 90 day notice period to affected employees rather than a 60 day period under the prior Act.   If notice is not properly given, the employer is required to pay four week’s severance per year worked per employee.  With proper 90 day notice, NJ WARN now requires all terminated employees to be paid one week of severance for each year of employment.  This is a change from the prior NJ WARN Act where severance was only required if proper notice was not given.  

The changes in the severance provisions under NJ WARN makes New Jersey the first state to mandate severance pay to employees separated as a result of certain layoffs, transfers, or terminations of operations even if proper notice of the impending layoffs is provided.