Most employers that have gone through a large-scale layoff or closed a location will tell you that WARN is their most dreaded four-letter word. Now, with the continuing and even increasing prevalence of post-COVID remote work arrangements, the question of who to WARN of mass layoffs of closures has become even more daunting.

The federal Worker Adjustment and Retraining Notification (WARN) Act requires employers with at least 100 full-time employees to provide 60 days’ advance notice in the event of a closing or mass layoff affecting at least 50 full-time employees at a “single site of employment.” Normally, an employees’ employment site simply is the location where the employee works. But the answer is less obvious for employers with remote employee populations. Unlike, for example, New York’s state law mini-WARN Act, the federal WARN Act does not explicitly address remote employees. (As we wrote about here, amendments to the NY WARN Act regulations, which went into effect on June 21, 2023, provide that “individuals who work remotely but are based at the employment site” are counted as employees of that employment site.)

Instead, WARN regulations appear to only contemplate traveling, outstationed, or similar employees with no fixed place of work who are required to travel from point to point. For these “mobile” employees, the single site of employment is either (i) their home base, (ii) the place from which their work is assigned, or (iii) the place to which they report.

Thus, on its face, the WARN Act and its regulations do not appear to contemplate truly remote workers who have a fixed place of work (their homes). Case law has not resolved the issue; those relatively few courts that have looked at the issue to date have offered conflicting decisions addressing the issue of WARN notice to remote employees. It is therefore not surprising that many employers have chosen to proceed cautiously and include remote workers in the bucket of employees for which WARN notice is given.

Recently, however, one employer took a different approach. On December 7, 2023, all of Zulily LLC’s employees were laid off in connection with the company’s liquidation. The company had approximately 300 Washington-based employees and approximately 550 Ohio-based employees. Some of these employees worked in offices in Ohio or Washington, and some worked remotely from their homes. When the layoff was announced, only the in-office employees were provided with WARN notice.

Predictably, this resulted in litigation. In May 2024, a group of Ohio-based remote workers filed a class action complaint against their former employer in the United States District Court for the Southern District of Ohio. Then, in September 2024, a group of Washington-based remote workers filed a similar class action complaint against Zulily in the United States District Court for the Western District of Washington. The plaintiffs in these cases allege that they were entitled to WARN notice because they were “assigned” to one of Zulily’s offices as their “home base,” pointing to, among other things, that they received performance evaluations, discipline, promotions and other communications from the Ohio or Washington offices.

Zulily moved to dismiss both complaints, arguing that the “mobile worker” exception to WARN’s single site of employment is inapplicable to fully remote workers because “the single site of employment for a remote employee with a fixed at-home workspace is the employee’s home,” not corporate headquarters. As of the date of this blog, neither court has ruled on the pending motions.

Hopefully, the Ohio and Washington district courts will bring some much-needed clarity for employers looking to navigate the complexities of WARN Act compliance.