issuing WARN Act notices. And it also means that they expect you to wait to make your own plans until after those specific cuts are announced.
The White House may be forced to disclose those specific cuts on a timely basis. The House and Senate agreed to a disclosure bill (H.R. 5872) that was sent to the White House on July 27. The Bill would require the White House to disclose its planned cuts in detail, in September. The President had not yet signed that bill as of the time this article was developed, but it appears that unless he vetoes the bill, it will require disclosure of the specifics about sequestration before the WARN Act deadline.
Courts generally defer to an Agency
interpretation as long as it is based on a permissible construction of a statute. It is possible that the courts would have deferred to the Labor Department’s interpretation of the WARN Act here, however it is also possible that a court may find that Labor’s guidance is not based on a permissible construction. One requirement for court deference is that the interpretation must be reasonable, and it would not be hard for a court to declare the Administration guidance to be unreasonable, especially in light of the Congressional Act requiring early
disclosure of the programs that are being cut. If a Court were to rule that the Labor Department Guidance is unreasonable, or moot in the wake of H.R. 5872, then a delay in issuing WARN Act notices may result in legal liability for employers. Employment lawyers will certainly be thinking about class action suits against defense contractors who fail to issue timely WARN Act notices, and they will be arguing that the Administration’s guidance does not absolve a company from its obligations “to read the handwriting on the wall.” Companies subject to the WARN Act should consult a labor lawyer before making a final determination regarding WARN Act compliance. The real losers in this guidance would be the employees who will be let go as a consequence of sequestration. Under the WARN Act, they are entitled to 60 days notice in order to prepare for the layoffs and seek out other employment or training. Sometimes businesses are accused of playing fast and loose with this notice for their own purposes. But it seems unprecedented for the U.S. Government to play fast and loose with the notice requirements that protect employees, in a clumsy effort to achieve a political advantage. Ordinarily, you would expect the
Administration to have a budgetary plan to forestall sequestration; but not in this case – the Administration’s 2012 budget did not take into account any plan to reduce spending to offset sequestration, and no amendment was ever offered. The House of Representatives passed a bill to prevent sequestration by cutting other programs, but that bill was never taken up by the Senate. There is still a chance that sequestration could be set aside by a Congressional budget deal that finds other cuts, but the chances of this happening are growing slimmer by the day. In the mean time, aerospace defense contractors will need to consider their legal obligations if they anticipate lay-offs. AM
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