International Brotherhood of Boilmakers v. NASSCO Holdings Incorporated

Case Updates

The California Court of Appeal affirmed the trial court’s decision, holding that the California WARN Act applies to an employer’s temporary layoff.

The U.S. Chamber filed an amicus brief urging the California Court of Appeal to reverse a trial court’s broad interpretation of the California Worker Adjustment and Retraining Notification Act (“California WARN Act”).

The California WARN Act requires covered employers to provide 60 days’ notice to affected employees before any “mass layoff.” The trial court in this case adopted an exceedingly broad definition of the term “layoff,” holding that a “layoff” occurs not just when an employer terminates employees, but any time employees go without work for a period of time, even if they remain employed. Under the trial court’s interpretation, an employer must satisfy the WARN Act’s notice requirements if it imposes any temporary work stoppage or furloughs employees for any length of time, whether for a single day or, as in this case, for a period of weeks.

The Chamber’s brief argues that the trial court’s reading is contrary to the California WARN Act’s text and is out of step with how other jurisdictions interpret and apply their own advance-notice statutes. The brief also explains that the trial court’s broad “layoff” definition will harm California employers, will do nothing to promote the California WARN Act’s purposes, and will produce absurd results.

This brief was filed jointly with the National Association of Manufacturers, California Manufacturers & Technology Association, and Shipbuilders Council of America.

Fred A. Rowley, Jr. and Aaron D. Pennekamp of Munger, Tolles & Olson LLP served as counsel for the U.S. Chamber of Commerce on behalf of the U.S. Chamber Litigation Center.