Need to reduce your workforce or lay off employees?
While no employer wants a layoff, managing one well can make things easier. A well-managed layoff includes the following:
- There’s a clear plan for conducting the layoff, from deciding who will be laid off to arranging job search assistance for displaced workers.
- The plan is compliant with laws governing layoffs, such as the Worker Adjustment and Retraining Notification ACT (WARN).
- All employees stay as productive and positive as possible throughout the layoff process.
- There’s an emphasis on good public relations, so the organization’s brand and reputation in the community remain intact.
Find layoff resources and answers to frequently asked questions below.
Unemployment Insurance is a joint state-federal program that provides temporary cash payments to eligible unemployed workers while they look for a new job. The program is funded by taxes paid by businesses. The amount of unemployment tax you pay is affected by the claims made by former employees.
Employees may be eligible for unemployment assistance after a layoff. When a former employee files an unemployment claim, the former employer receives notice. You will be expected to validate the details of the claim such as dates and type of employment, wages, reason for separation, etc. You are required to take action to respond, whether to accept the claim or contest it if it's inaccurate. Find general information on the UI Program and UI taxes at the federal and state levels.
Many states have Shared Work programs with the goal of avoiding layoffs during a temporary slowdown. Employees receive partial unemployment benefits while working reduced hours.
Contact your state's Unemployment Insurance (UI) program to learn if your state participates in the Shared Work Program.
Rapid Response is a federal program available to qualifying organizations that can help you manage a layoff process effectively. Rapid Response offers two key functions:
- Provide employers with access to a skilled labor pool in their area
- Provide immediate assistance to companies facing layoffs
Your Rapid Response transition team will meet with you; work one-on-one with displaced workers to discuss unemployment insurance benefits, job placement services, and training options; and help you coordinate with other services in your area.
Learn more
To learn more about Rapid Response, contact your local American Job Center. If your company is not eligible for Rapid Response, other services may be available to you and your laid-off workers.
If you need to lay off a large number of employees, you may need to provide advance notice under the regulations of the Worker Adjustment and Retraining Notification Act. The WARN Act requires advance notice when:
- A company with 100 or more full-time workers lays off 50 or more employees at a single site, or
- A layoff will affect 33% of a workforce that totals between 50 and 499 workers.
The U.S. Department of Labor has compliance assistance materials to help workers and employers understand their rights and responsibilities under the provisions of WARN.
The Employer's Guide to WARN provides a brief overview of the WARN Act provisions and answers to frequently asked questions about employer responsibilities and requirements.
