hr-rif

> **Templates only - not employment-law advice.** A RIF without WARN Act compliance, disparate-impact analysis, and OWBPA-compliant releases is a class-action fact pattern. Have HR counsel sign off BEFORE notification.

# HR - Reduction in Force (RIF)

Plan a legally-defensible reduction in force: WARN Act analysis, disparate-impact pre-check, notification timeline, severance and release framework.

## ⛔ STOP - counsel checkpoint required

Multi-state RIFs and any RIF affecting 50+ employees at a single site MUST go through counsel BEFORE notification. WARN Act notice timing, mini-WARN state variations, and OWBPA disclosure obligations are unforgiving.

## Pre-flight (REQUIRED)

1. **Total company headcount** (federal WARN at 100+ EE)
2. **Headcount at affected single site** (federal WARN site-level rules)
3. **Number of employees affected**
4. **% of total workforce affected**
5. **Geography** - list every state with affected employees (mini-WARN routing)
6. **Demographic data of selected list** - race / sex / age / disability / pregnancy / FMLA status (for 4/5ths rule analysis); compare to retained pool
7. **Business reason** - economic downturn / restructuring / closure / acquisition; document
8. **Severance offered?** - consideration beyond what's owed (additional weeks, COBRA subsidy, accelerated equity)
9. **Any affected employee on protected leave / pending complaint / accommodation request?** - high retaliation risk; specific counsel review

## Federal WARN Act (1989)

- **Threshold**: 100+ full-time employees (or 100+ FT and PT working >4,000 hrs/wk)
- **Triggers** (90-day window):
  - **Plant closing**: shutdown of single site causing employment loss for 50+ employees
  - **Mass layoff**: employment loss for 500+ employees, OR 50-499 employees if they constitute ≥33% of single-site workforce
- **Notice**: **60 days written advance notice** to (a) affected employees or their reps, (b) state dislocated worker unit, (c) chief elected official of local government
- **Penalties**: back pay + benefits for each violated day (up to 60 days), $500/day to local government
- **Exceptions**: faltering company (closing only), unforeseeable business circumstances, natural disaster - all narrowly construed

## Mini-WARN states

| State | Threshold | Notice | Notes |
|-------|-----------|--------|-------|
| **CA** | 75+ EE; covered facility | **60 days** | Includes relocations 100+ miles; CalWARN broader than federal |
| **NY** | 50+ EE; site-based | **90 days** (longer than federal) | "Reduction in workforce" of 25+ EE / 33% / 250+ |
| **NJ** | 100+ EE | **90 days** + mandatory severance (1 wk per yr of service) | NJ Millville Dallas Airmotive Plant Job Loss Notification Act |
| **IL** | 75+ EE | 60 days | |
| **TN** | 50+ EE | 60 days | |
| **HI** | 50+ EE | 60 days | + dislocated worker allowance |
| **WI, IA, KS, MN, ND, OH, OR, PA, RI, SC, VT** | Various | Various | Verify state DOL |

## Disparate-impact pre-check (4/5ths rule)

Before announcing a RIF, run this analysis on the selected list:

| Group | # in retained pool | # in selected list | Selection rate (selected / pool) | Ratio vs majority |
|-------|---------------------|---------------------|----------------------------------|-------------------|
| Sex: female | [X] | [X] | [%] | [ratio] |
| Sex: male | [X] | [X] | [%] | 1.00 (baseline) |
| Race: Black | [X] | [X] | [%] | [ratio] |
| Race: Hispanic | [X] | [X] | [%] | [ratio] |
| Race: White | [X] | [X] | [%] | 1.00 (baseline) |
| Age: 40+ | [X] | [X] | [%] | [ratio] |
| Age: <40 | [X] | [X] | [%] | 1.00 (baseline) |
| Disability | [X] | [X] | [%] | [ratio] |
| Pregnancy | [X] | [X] | [%] | [ratio] |
| FMLA in last 12 mo | [X] | [X] | [%] | [ratio] |

**Adverse-impact flag**: any protected group with selection ratio < 0.80 (4/5ths) of the majority group, OR significant overrepresentation of FMLA/protected-event employees in selected list.

If flagged: **DO NOT proceed**. Either (a) document business necessity for the criterion driving the disparity, OR (b) revise the selection list. Document analysis and decisions contemporaneously.

## Selection criteria - defensible vs not

| Defensible | Risky |
|------------|-------|
| Job/position elimination (specific roles cut) | "Last in, first out" alone (age proxy) |
| Skills / certifications required for retained roles | "Highest paid" (age + tenure proxy) |
| Documented performance ratings (if rating process is rigorous + bias-checked) | "Manager discretion" with no criteria |
| Cross-training / breadth of skills | "Cultural fit" |
| Specific competency requirements | "Most likely to leave anyway" |

## OWBPA / ADEA group-RIF requirements (employees 40+)

When 2+ employees aged 40+ are in the RIF and severance is offered in exchange for a release, OWBPA requires:

- **45-day** consideration period (longer than non-RIF 21 days)
- **7-day** revocation after signing
- **Written disclosure** with the release containing:
  1. The decisional unit (the class, unit, or group from which selection was made)
  2. The eligibility factors / selection criteria
  3. Time limits applicable
  4. Job titles AND ages of all employees eligible or selected for the program
  5. Job titles AND ages of all employees in the same job classification or organizational unit who were NOT eligible or selected

Failure to include the disclosure invalidates the ADEA release for those individuals. Sample format:

```
ATTACHMENT - OWBPA DISCLOSURE FOR GROUP RIF

DECISIONAL UNIT: [Define - e.g., "Marketing department, Tier 2 and Tier 3 ICs and managers, US-based, as of [date]"]

ELIGIBILITY FACTORS / SELECTION CRITERIA: [List specifically - e.g., "Roles eliminated due to consolidation of Brand and Demand-Gen functions; selection based on (1) elimination of duplicate functions, (2) last 2 cycles of performance ratings, (3) skill match to remaining roles."]

TIME LIMITS: 45 days from receipt of this Agreement to consider; 7 days after signing to revoke.

EMPLOYEES SELEC