Welcome to the first part of our article series focusing on the rules and regulations surrounding layoffs in Wisconsin. Whether you’re an employer, an employee, or someone interested in the Wisconsin labor market, we hope this series will make the topic easier to understand and give you useful insights.
In Wisconsin, layoffs and business shutdowns are not taken lightly. They are governed by a specific law known as the Wisconsin Business Closing and Mass Layoff Law. This law, similar but not identical to the federal Worker Adjustment and Retraining Notification (WARN) Act, sets out guidelines for how employers must proceed in the event of large-scale job losses.
The 2024 Layoffs at Wisconsin
Let’s examine the hypothetical situation of layoffs occurring in Wisconsin in 2024. Assume an employer with 100 employees decides to close its business. What responsibilities does this employer have under Wisconsin law? We can refer to the guidelines provided by the Wisconsin Business Closing and Mass Layoff Law to understand the process.
The first thing to know is that the law applies to this employer because they have more than 50 employees. However, not all those 100 employees are necessarily counted. The law excludes ‘new’ employees who have worked for the company for less than six out of the last 12 months, and ‘low-hour’ employees who work fewer than 20 hours a week on average.
Assuming the business closing affects 25 or more employees, this counts as a ‘business closing’ under the law. The employer must then provide written notice of this closing 60 days in advance. This notice is not only for the employees but also the Wisconsin Department of Workforce Development, their collective bargaining representatives, and the highest official of the municipality where the business is located.
A Look At Wisconsin’s 2023 Layoffs
Now, let’s look back at a previous hypothetical scenario – layoffs in Wisconsin in 2023. Suppose a company had to lay off 50 employees due to financial difficulties. How would the Wisconsin Business Closing and Mass Layoff Law apply in this case?
As with the 2024 scenario, the law would apply to this employer since they have more than 50 employees. The ‘mass layoff’ definition under the law is met if at least 25 percent of the workforce or 25 employees, whichever is greater, are affected, or if at least 500 employees are affected. In this scenario, if more than 25 employees or 25 percent of the workforce are affected, the company would have to issue the same kind of 60-day notice outlined above.
It’s also worth noting that if two or more groups of employees are affected within a 90-day period, these groups can be considered together when determining if the thresholds for a closing or layoff have been met. This is unless the layoffs are due to separate and distinct actions and causes.
In both these scenarios, the employer risks penalties if they fail to provide the proper notice. These penalties can include up to 60 days of back pay and benefits for the affected employees, and a surcharge of up to $500 per day for failure to notify the municipality.
These examples illustrate the care and attention that Wisconsin law requires from employers when layoffs or business closings become necessary. The law is designed to protect the rights of workers and give them as much advance notice as possible to prepare for the change. In our next part, we will discuss the different exceptions to this law and the special procedures that apply to faculty layoffs in the University of Wisconsin System.
Wisconsin Overview
In Wisconsin, the labor market is constantly evolving, with businesses routinely facing changes that may require adjustments to their workforce. A significant part of these adjustments can sometimes involve layoffs. Wisconsin has a unique set of laws in place to regulate these layoffs and ensure that both employers and employees are treated fairly. The Wisconsin Business Closing and Mass Layoff Law, for instance, provides clear guidelines for employers planning to close their businesses or lay off employees.
This law not only sets out the requirements for who the law applies to but also outlines the notification procedures that employers must follow. For example, the law applies to employers with 50 or more employees, excluding those classified as ‘new’ or ‘low-hour’ employees. These employees must be given a 60-day notice in advance of a business closing or mass layoff. This notice needs to be sent to several parties, including the affected employees, their representatives, the Wisconsin Department of Workforce Development, and the highest official of the municipality where the business is located.
The Reasons Behind These Layoffs
There can be various reasons behind the decision of a company to lay off employees. It could be due to economic downturns, changes in industry trends, a decrease in the demand for certain products or services, or even the decision to shut down the business. In any case, Wisconsin law mandates that employers must give their employees ample time to prepare for such changes. This is why the 60-day notice is required.
It’s important to note that the law takes into consideration the impact of these layoffs on the employees and the local community. The penalties for non-compliance are significant and can include up to 60 days of back pay and benefits for the affected employees, and a daily surcharge of up to $500 for failure to notify the municipality. These penalties serve as a deterrent to employers who might otherwise neglect their responsibility to their employees and the community.
Can We Expect More Layoffs in the Future?
While it’s impossible to predict the future with certainty, we can look at trends and economic indicators to make informed hypotheses. Layoffs are often the result of economic downturns, changes in industry trends, or business closures. As such, they can occur at any time, in any industry.
However, what’s important is that Wisconsin has a robust system in place to protect the rights of workers and alleviate the impact of such layoffs. Regardless of what the future holds, employees in Wisconsin can take solace in the fact that the law is on their side, providing protections and stipulating requirements for employers to follow in the event of layoffs.
In the next part of this series, we will explore the exceptions to the Wisconsin Business Closing and Mass Layoff Law and delve into the specific procedures that apply to faculty layoffs in the University of Wisconsin System. Stay tuned for more insights and information on this important topic.
Financial Performance Of Wisconsin
Understanding the financial performance of Wisconsin gives us a broader perspective on the reasons behind layoffs. Wisconsin’s economy, like many others, has had its fair share of ups and downs. The state’s financial health is dependent on several factors, including industry growth, employment rates, and overall economic conditions.
Wisconsin’s economy is diverse, with major sectors including manufacturing, healthcare, agriculture, and education. While these sectors have seen periods of growth, they’ve also faced challenges. For instance, shifts in the global market or advancements in technology can impact the manufacturing sector, potentially leading to layoffs.
Changes in economic conditions can also affect the state’s financial performance. During periods of economic downturns, companies might face financial challenges that force them to reduce their workforce. This has been particularly evident during the global COVID-19 pandemic, which had significant economic impacts and led to increased layoffs.
The Layoffs Impact on Employees
Layoffs can have a profound impact on employees. Losing a job can not only lead to financial hardship but also cause emotional distress. This is why Wisconsin’s Business Closing and Mass Layoff Law is crucial. It ensures that employees are given a fair notice period, allowing them time to search for new employment or seek retraining opportunities.
Furthermore, receiving a 60-day notice can provide employees with a sense of security during a challenging time. It gives them time to adjust and plan for the future. They can use this period to update their resumes, explore new job opportunities, or even consider a career shift.
Despite the difficulties, it’s important to remember that layoffs can sometimes open up new possibilities. They can act as a catalyst for change, encouraging individuals to explore new career paths or attain new skills. Still, the immediate impact can be quite stressful, making support systems, like the provisions in Wisconsin law, vital.
Conclusion
Layoffs, while challenging for both employers and employees, are sometimes a necessary part of business operations. Wisconsin’s Business Closing and Mass Layoff Law helps to ensure that when layoffs do happen, they’re carried out in a manner that respects the rights of the workers and gives them time to prepare for their next steps.
From an economic perspective, although layoffs can indicate difficulties within a particular company or sector, they can also be seen as a part of the natural economic cycle. By understanding the financial performance of Wisconsin and the potential reasons behind layoffs, we can better navigate the complexities of the labor market.
In the end, it’s the resilience and adaptability of the workers that help to keep Wisconsin’s economy moving forward. In our next section, we’ll look at the exceptions to the Wisconsin Business Closing and Mass Layoff Law and the specific procedures that apply to faculty layoffs in the University of Wisconsin System.
