Why N.H. needs its own WARN Act
Sept. 1 marked the second incremental increase in our state’s minimum wage, boosting the hourly rate from $6.55 to $7.25 per hour – the state’s first minimum wage adjustments in 10 years.
In a July 2007 discussion paper, the Federal Reserve Bank of Boston estimated that 8,988 New Hampshire workers would be affected by the first minimum wage hike from $5.15 to $6.50 per hour, and that an additional 17,000 workers would be affected by the increase from $6.50 to $7.25. This is a most welcome and overdue measure of relief for workers who are at the lowest end of the wage scale and are struggling mightily just to make ends meet.
Now that we have made this progress in ensuring a more decent wage for the lowest-paid New Hampshire workers, it’s time to see to it that employers must give them – and all other employees — reasonable notice if their wages are going to be taken away.
On the matter of issues affecting workers, most employers want to do the right thing or want to be educated to do the right thing. A good example was the layoff several years ago of 550 Jac Pac workers in Manchester. This company provided the 60-day notification required by the federal Worker Adjustment and Retraining Notification (WARN) Act. New Hampshire’s Rapid Response Team was able to provide re-employment services on site, and a smooth transition took place, with job training, English as a second language training and other supportive services provided through a $2.3 million grant from the U.S. Department of Labor.
Unfortunately, not all company closures are handled so well. Two of the worst labor situations I have seen since I have been in my current position demonstrate this point all too painfully.
On Nov. 17, 2005, the Department of Labor received several calls from workers who reported to work only to find their employer’s doors locked. The company, known as CCT (Car Component Technologies), had abruptly closed. The WARN Act dictates that if a major employer plans to close or engage in mass layoffs it must provide 60 days notice to the workers and the local government. If it fails to do so, a federal court may order civil penalties and payments to the workers. However, it is up to the workers themselves to pursue that court action.
These 560 workers were preparing, as each of us was, for Thanksgiving with their families — but they were out on the street without their final paycheck, without their compensation for accrued vacation time, without their 401(k)s, without health insurance coverage and without coverage for medical claims that occurred during the course of their employment when deductions were taken out of their paychecks on a weekly basis.
Governor Lynch dispatched Peter Roth, senior assistant attorney general, and me to the Delaware Bankruptcy Court to fight for these workers’ wages. We were able to recoup 35 percent of the accrued vacation time, all final paychecks, and all of the 401(k)s. The Department of Labor also negotiated with several medical facilities regarding unpaid medical bills.
Fast forward to Dec. 21, 2007, when 122 workers at CSI (Customized Structures Inc.) were notified the company would close on Dec. 24.
Governor Lynch’s proactive approach resulted in 30 days of additional pay for these workers, and he reached out to New Hampshire Legal Assistance, which is currently representing these workers to address the company’s failure to provide 60-day notification of loss of employment under the federal law.
These are two stark examples that demonstrate the need for a state WARN Act, which would provide additional protection to New Hampshire workers and would hold corporate officers legally liable for failure to provide the 60-day notification – thereby making it far more likely that such notification would be furnished.
For New Hampshire workers, the state Department of Labor is the last stop in the protection of their rights. I believe that enactment of a state WARN Act is the fair, just and honorable thing to do to protect the rights of workers in our state. No honorable employer should disagree.
George N. Copadis is commissioner of the New Hampshire Labor Department.