Understanding HR5761: Fair Warning Act of 2025

The Fair Warning Act of 2025 updates the Worker Adjustment and Retraining Notification (WARN) Act to offer stronger protections for workers facing job loss. Under this bill, the definition of who is affected by layoffs is expanded. Now, any employee who reasonably expects to lose their job is considered an "affected employee." The bill also broadens the definition of an "employer" to include businesses with at least 50 employees or an annual payroll of $2 million. One of the major changes is the requirement for employers to provide a 90-day written notice before any site closures or mass layoffs. This notice must be given to the employees, the Secretary of Labor, and local government officials. The notice should include details about the number of employees affected, the reasons for the layoffs, whether the layoffs are permanent, and information about the employees' rights to wages and benefits. The bill also introduces exceptions to the notice requirement for situations where urgent financing or business opportunities could save jobs, or in cases of unforeseeable events like natural disasters or health emergencies. Additionally, it mandates that laid-off workers receive a guide from the Department of Labor on unemployment benefits and retraining opportunities, as well as information about job openings at other sites owned by the same employer. To increase transparency, the bill requires the creation of a public database by the Secretary of Labor. This database will track layoffs and site closures by employer name, number of affected employees, location, and industry.

For many workers, sudden job loss can be devastating. The Fair Warning Act of 2025 aims to provide employees with more time to prepare for such events. By extending the notice period to 90 days, workers have a better chance to search for new jobs, acquire new skills, or even relocate if necessary. This can be particularly important for families who rely on a single income or who have members with special needs. The bill also aims to protect smaller groups of employees who might otherwise be overlooked, such as those working in retail chains or small offices. By lowering the threshold for what constitutes a mass layoff, more workers will receive the protections they need. Additionally, the public database will help communities and policymakers understand and respond to economic shifts, potentially leading to more targeted support for affected areas.

- More time to prepare: The 90-day notice period gives workers more time to find new jobs or retrain, reducing the financial impact of job loss. - Catches smaller layoffs: By lowering the threshold for mass layoffs, the bill protects employees in smaller businesses who might otherwise be left out. - Transparency via database: A public database allows for better tracking of layoffs, helping policymakers and communities respond more effectively. - Leave protections: The bill includes liability for disrupted medical or parental leave, offering additional security for families. - Benefits access: Providing guides on unemployment and retraining ensures workers can access the support they need.

- Business flexibility hit: The 90-day notice requirement could hinder a company's ability to quickly respond to market changes. - Broader coverage burdens small firms: The new definitions could impose additional costs on smaller businesses, potentially stifling growth. - Penalty risks: The financial penalties for non-compliance could be severe for businesses already in crisis. - Admin costs: Creating and maintaining the public database could be costly for both the Department of Labor and employers. - Waiver bans: Prohibiting pre-dispute waivers might lead to an increase in lawsuits, adding legal burdens for businesses.