The Worker Adjustment Retraining and Notification Act (WARN Act)
requires certain employers to give employees 60 days' notice of
plant closings and mass layoffs. The goal of the WARN Act is
to "provide workers and their families transition time to
adjust to the prospective loss of employment, to seek and obtain
alternative jobs and, if necessary, to enter skill training or
retraining that will allow these workers to successfully compete in
the job market." Employers who violate the WARN Act are
liable to affected employees for up to 60 days of compensation and
benefits.
On December 10, 2013, the Second Circuit in Guippone v.
BH S&B Holdings LLC addressed whether a holding
company (HoldCo) and certain investors (Investors) should be deemed
"employers" under the WARN Act, and thus liable for
violations thereof. The Investors created various entities to
purchase and manage Steve & Barry's Industries, Inc., which
it acquired out of bankruptcy. HoldCo served as the
