Ninth Circuit Rules That An Employee Who Quits Because The Business Is Closing Has Not "Voluntarily Departed" Under the WARN Act


On January 21, 2011, the Ninth Circuit Court of Appeals in Collins v. Gee West Seattle LLC held that when an employee voluntarily leaves because the company is closing, the employee has not "voluntarily departed," but has instead suffered an "employment loss" under the Worker Adjustment and Retraining Notification ("WARN") Act, 29 U.S.C. § 2101 et seq.

The WARN Act requires an employer to provide 60-days' notice before a mass-layoff or plant closure to its "affected employees," but only "if the shutdown results in an employment loss at the single site of employment during any 30-day period for 50 or more employees . . . ." 29 U.S.C. § 2101(a)(5). The WARN Act defines "affected employee" as one who "may reasonably be expected to experience an employment loss as a consequence of a plant closing . . . ." 29 U.S.C. § 2101(a)(5). "Employment loss" includes "an employment termination, other than a discharge for cause, voluntary departure, or retirement." 29 U.S.C. § 2101(a)(6).

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