NJ WARN Act: Notice, Severance, and Penalties

New Jersey’s WARN Act requires covered private employers to give 90 days’ written notice before a mass layoff, plant closing, or transfer of operations that eliminates 50 or more jobs, and it requires them to pay every affected worker severance equal to one week of pay for each full year of service. The current version of the law has been in force since April 10, 2023, and its severance mandate and 90-day notice period both go beyond what the federal WARN Act requires.

Who the Law Covers

The statute reaches private business entities operating an establishment in New Jersey that has been running for more than three years. Federal, state, and local government employers are not covered, and temporary construction sites are specifically excluded.¹

The law splits its obligations by employer size. The 90-day advance notice requirement applies only to employers with 100 or more employees. The severance requirement, however, kicks in whenever 50 or more employees lose their jobs in a covered event, regardless of the employer’s total headcount.² Every worker counts toward these thresholds. Unlike the federal WARN Act, New Jersey draws no distinction between full-time and part-time employees.¹

An “establishment” can be a single location or a group of locations within the state. Employers with multiple New Jersey sites should evaluate headcounts and terminations across all of them.

What Triggers the Act

Three types of workforce reductions fall under the statute, and each must result in 50 or more employees losing their jobs within a 30-day period at a single establishment.²

A mass layoff: a reduction in force of 50 or more employees at or reporting to a single establishment that isn’t the result of a closing or transfer. The 2023 amendments removed the earlier requirement that the layoff also affect at least one-third of the workforce, so any layoff hitting 50 workers now qualifies.
A termination of operations: the permanent or temporary shutdown of an entire establishment or one or more operating units within it.
A transfer of operations: moving an establishment or operating unit to a different location, inside or outside New Jersey, when the move results in 50 or more terminations at the original site.

Layoffs Can Be Added Together

Employers can’t dodge the law by breaking a layoff into smaller rounds. If multiple groups are let go at the same establishment within any 90-day period and each one falls below 50 employees, the groups are added together. The combined total triggers the law unless the employer can show that each group’s layoff had a completely separate and distinct business cause.¹

Departures That Don’t Count

Not every exit counts toward the 50-employee threshold. The statute excludes voluntary resignations, retirements, discharges for employee misconduct, and seasonal workers. An employee also isn’t considered terminated if the employer offers the same position or an equivalent role, with comparable pay, benefits, and working conditions, at a location within 50 miles inside New Jersey.¹ If you accept a comparable in-state transfer within that radius, no severance is owed.

When the Act Doesn’t Apply at All

Certain events take a layoff or closing entirely outside the statute’s reach. The NJ WARN Act does not apply to mass layoffs or shutdowns made necessary by a fire, flood, natural disaster, national emergency, act of war, civil disorder, or industrial sabotage. Two industry-specific exceptions apply as well: losing Medicare or Medicaid certification and having a health-care facility license revoked.¹ These are full exemptions, not short-notice provisions. When one of these events causes the layoff, neither the notice obligation nor the severance obligation applies.

Furloughs are also treated differently. A layoff announced as lasting six months or less isn’t a termination of employment. If the furlough later stretches past six months because of business circumstances the employer couldn’t have reasonably foreseen, it still doesn’t trigger WARN obligations as long as the employer gives notice when the extension becomes foreseeable.¹ If the employer can’t demonstrate that the extension was unforeseeable, the layoff is reclassified as a termination retroactive to its start date, and notice and severance obligations follow.

The 90-Day Notice Requirement

Employers with 100 or more employees must deliver written notice at least 90 days before the first termination takes effect.² For employers below 100 employees, the statute specifies no separate notice period, but severance is still mandatory when 50 or more jobs are cut.

Notice has to go to four parties:

Each affected employee whose job will be eliminated
Any union representing employees at the establishment
The chief elected official of the municipality where the establishment is located
The Commissioner of Labor and Workforce Development

The notice itself should identify the establishment’s address, name a company official who can answer questions, state the total number of employees affected, and give the expected date of the first termination or the final day of operations. The New Jersey Department of Labor now accepts WARN filings through an online form on its website, and once a filing is received, the Department dispatches a rapid response team to provide information, referrals, and counseling to affected employees.³

Mandatory Severance Pay

Every employee whose job is eliminated in a covered event is entitled to severance equal to one week of pay for each full year of service with the employer.² This applies to every covered employer, not just those with 100 or more employees. An employee with 12 full years at the company gets 12 weeks of pay.

The rate used for the calculation is the higher of two figures: the employee’s average regular rate of compensation over the last three years of employment, or the employee’s final regular rate of compensation.² Using the higher of the two protects workers whose pay was reduced before the layoff and rewards long-tenured employees whose earlier wages averaged higher than their final salary.

The statute treats this severance as compensation earned in full at the moment the employment relationship ends. That classification gives it the same wage-protection status as back pay, enforceable through the same mechanisms available for unpaid wages.

Waivers Need Approval

An employer can’t quietly fold a severance waiver into a separation agreement. Under the statute, no waiver of the right to WARN severance is effective unless approved by the Commissioner of Labor and Workforce Development or a court.¹ If you’re asked to sign away WARN severance without that approval, the waiver likely has no legal force.

If Your Employer Already Offers Severance

When an employer already provides severance under a collective bargaining agreement or a company policy, the employee receives whichever amount is greater: the statutory minimum or the employer’s own plan. The two do not stack. Any back pay collected under the federal WARN Act for a federal notice violation can also be credited against the New Jersey severance obligation.²

The Penalty for Short Notice

An employer that gives less than the required 90 days of notice must pay each affected employee an additional four weeks of pay on top of their severance.² That penalty is per employee, so it adds up fast. An employer laying off 200 workers faces 800 weeks of pay in penalty alone.

Liability doesn’t stop at the corporate entity. The statute’s definition of “employer” includes anyone acting directly or indirectly in the interest of the business, which courts have interpreted to reach corporate officers, subsidiary owners, and the individual decision-makers who authorized the layoff.¹ This personal liability matters most when a company shuts down and leaves severance obligations unpaid.

Severance, Unemployment, and Taxes

New Jersey does not reduce or delay unemployment benefits because a worker received severance pay. Under state regulations, severance or separation pay doesn’t bar eligibility for unemployment compensation.⁴ You can file for unemployment as soon as you’re separated, even if severance checks are still arriving. Many states offset benefits by the amount of severance received; New Jersey workers don’t face that delay.

WARN severance is taxable income. Because it’s typically paid as a lump sum or over a concentrated period, employers generally withhold federal income tax at the 22% supplemental wage rate rather than the employee’s regular withholding rate. Social Security and Medicare taxes also apply. If you’re receiving a large severance payment, consider making estimated tax payments or adjusting withholding on other income to avoid an unexpected balance at filing time.

What to Do After You Receive a WARN Notice

A WARN notice is not an immediate firing. If your employer has 100 or more employees, you have at least 90 days before your job actually ends. Use that window to start your job search and take advantage of any retraining referrals from the state’s rapid response team.

Calculate your expected severance by multiplying your full years of service by the higher of your three-year average pay rate or your current rate. If your employer offers a separation agreement with a different severance amount, compare it against the statutory minimum. You’re entitled to whichever is greater, and any waiver of the statutory amount requires approval from the Commissioner or a court.¹ If you’re offered a comparable position within 50 miles in New Jersey, the severance requirement doesn’t apply, because the statute doesn’t treat that as a termination.

File for unemployment promptly after your last day of work; there is no advantage to waiting.⁴ If your employer fails to pay severance, or gives less than 90 days of notice without paying the four-week penalty, you may have grounds for a legal claim to recover those amounts as unpaid wages.

1
New Jersey Department of Labor and Workforce Development. New Jersey Code 34:21-1 – Definitions Relative to Prenotification of Certain Plant Closings, Transfers, and Mass Layoffs
2
Justia. New Jersey Code 34:21-2 – Requirements for Establishments Subject to Transfer, Termination of Operations, Mass Layoffs
3
New Jersey Department of Labor and Workforce Development. File a WARN Notice
4
Legal Information Institute. N.J.A.C. 12:17-8.7 – Severance or Separation Pay