Layoffs, RIFs & Restructurings

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Last month the UK voted for a new government. The Labour party promised sweeping changes to UK employment law in its manifesto, and the King’s Speech confirmed the new government’s proposals to pursue numerous employment law reforms. Immediately following these announcements, Baker McKenzie employment partners Julia Wilson, Kim Sartin, Stephen Ratcliffe and Jonathan Tuck, and…

With thanks to Jonathan Isaacs, Baker McKenzie’s APAC Chair, Employment & Compensation, China / Hong Kong and Emma Pugh, Knowledge Lawyer, Employment & Compensation, Hong Kong.

The economic effects of the COVID-19 pandemic and the change in geopolitical landscape have forced employers globally to reassess and re-evaluate their business priorities. Our team is working…

What Canadian Employers Need to Know to Ring in 2024

In 2023, we helped Canadian employers overcome a host of new challenges across the employment law landscape. Many companies started the year with difficult cost-cutting decisions and hybrid work challenges. We’ve worked hard to keep our clients ahead of the curve on these issues, as well…

New York in the summer: warm days, Shakespeare in the Park, visits to the beach, and the end of the New York State legislative session–which often means a few surprises for New York employers. This summer, not only do employers have to contend with New York’s amended WARN Act regulations and the enforcement of New York City’s Automated Employment Decision Tool law (both now effective), they also have to keep a close eye on four New York State bills that have cleared both houses of the state legislature and could be signed by Governor Hochul–including one that would arguably be the nation’s broadest ban on employee noncompete agreements. We highlight two changes–and four that could be coming down the pike–New York employers should pay close attention to this summer.

Two to know

1. Amendments to New York’s WARN Act regulations now in effect.

New York State’s proposed amendments to its Worker Adjustment and Retraining Notification (WARN) Act regulations were adopted on June 21 and are now in effect. The definition of a covered employer has been expanded, remote employees must now be included in the threshold count, certain notices must include more information or be provided electronically, and exceptions for providing notice have changed (among other modifications). In addition, there’s a new York State Department of Labor WARN portal for employers to use for “a more streamlined user experience.” Want the details on the WARN Act regulation changes and some helpful tips for employers? See our prior blog here.

2. Enforcement of New York City’s Automated Employment Decision Tool law began July 5.

New York City’s Local Law 144 prohibits employers and employment agencies from using an automated employment decision tool to substantially assist certain employment decisions unless the tool has been subject to a bias audit within one year of the use of the tool, information about the bias audit is publicly available, and certain notices have been provided to employees or job candidates. Violations of the provisions of the law are subject to a civil penalty. Enforcement of the law began July 5, and employers need to be diligent. For those who haven’t done so yet, the first (and immediate) step is to take inventory of HR tech tools. Legal should partner with HR and IT to determine whether the company uses automated employment decision tools to make any employment decisions in a manner that triggers the law. See our prior blog here for additional steps to take, as well as further details on the law, penalties, and some practical tips for employers.

Four to watch

1. New York could become the fifth state to ban employee noncompetes.

On June 21, the New York State Assembly passed S3100 (already passed by the New York State Senate), which will be the most restrictive state-level ban on employers’ use of noncompetes to date if signed into law by Governor Hochul.

Under the bill, every contract that restrains anyone from engaging in a lawful profession, trade or business of any kind is void to the extent of such restraint.

The ban: The bill does not permit employers (or their agents) to “seek, require, demand, or accept a non-compete agreement” from a “covered individual.”

  • A “non-compete agreement” is any agreement (or clause in an agreement) between an employer and a “covered individual” that prohibits or restricts the individual from obtaining employment after the conclusion of employment with the employer. 
  • A “covered individual” is “any other person” who performs work or services for another person on such terms and conditions that puts them in a position of economic dependence on and under an obligation to perform duties for that other person–regardless of whether they are employed under a contract of employment.

Continue Reading New York Employer Summer Roundup: Two to Know and Four to Watch

With special thanks to our presenters Matías Herrero (Argentina), Leticia Ribeiro (Trench Rossi Watanabe, Sao Paulo*), Andrew Shaw (Canada), Maria Cecilia Reyes (Colombia) and Liliana Hernandez-Salgado (Mexico).

In this session, US-based multinational employers with business operations in the Americas region hear directly from Benjamin Ho and local practitioners on the major developments they need to…

With special thanks to presenters Elif Nur Çakır Vurgun (Türkiye), Johan Botes (South Africa), Joanna Matthews-Taylor (United Arab Emirates), Christiana O’Connell-Schizas (Saudi Arabia) and Ghada El Ehwany (Egypt).

In this session, US-based multinational employers with business operations in the Middle East and Africa region hear directly from Elizabeth Ebersole and local practitioners on the major…

With special thanks to Nadege Dallais (France), Emma Glazener (Netherlands), Fermin Guardiola (Spain), Stephen Ratcliffe (United Kingdom), Bernhard Trappehl (Germany) and Lucille Vallet (France).

Last week a group of our favorite European colleagues joined us in the Bay Area for a few special client visits. Even if you weren’t in the room, we’ll share a few key headlines here. (And, here’s link to listen in to our recent webinar: Global Employment Law Fastpass — Spotlight on Europe!)

From practical tips on the best ways to implement employee redundancies to the expected impact of the recently-passed EU Directive on Pay Transparency, here’s five things to know:

1. The EU Whistleblowing Directive (WBD) Requires Private Employers with 50 or More Workers to Establish a Local, Entity Level Reporting Hotline

The WBD was supposed to be implemented by the EU’s 27 member states by December 2021, but we are still waiting for around 8 EU member states to do so. For example, France, Belgium and Austria have transposed the WBD, Germany has not but is close. Spanish companies with at least 250 employees have until June 13, 2023 to comply. (For more, read our alert here.)

While legislation is still awaited in a number of jurisdictions, we are now in a much better position to see the challenges the WBD poses for global employers. . . and there are several.

  • It can be tricky to implement the new requirement for a local channel alongside a centralized group level reporting system (e.g., through a global “hotline”). Under the WBD, employers are not prevented from maintaining and encouraging the use of their central reporting hotline; however, now, entities with more than 50 workers, must establish a local, entity level, channel. This means employers who meet the threshold will need to establish local entity level reporting systems alongside existing global channels.
  • The second key challenge is where companies have multiple entities in one jurisdiction, whether one internal reporting channel can be established at a country level or whether the channel must be established in each entity. The implementing legislation in some countries is unclear on this point but, where the requirement is for entity level channels, this raises challenges for companies which have multiple entities within a jurisdiction but only one HR or Legal function which operates across multiple entities.

Fortunately, we have a multijurisdictional analysis matrix covering five key areas of WBD compliance at a local level available at a fixed fee per jurisdiction so that companies operating in the EU can wrap their arms around this new requirement. The matrix answers questions about the Directive’s scope and implementation requirements for internal procedures, protection of whistleblowers and data privacy issues. Our experienced team of lawyers can then assist with implementing the changes, as well as with training, communications and more.

2. The EU Pay Transparency Directive is Coming and as the Kids Say, It’s Extra

Last month the European Parliament formally adopted the Pay Transparency Directive and its provisions are likely to enter into force in most EU member states in 2026. It’s sort of a big deal, requiring significant attention and touching on many aspects of the employment lifecycle (read our detailed alert here).

A preview: there are pre-employment pay transparency requirements, and broad worker and representative rights to workforce pay information. The impact may be more muted in countries like France where works councils already have access to pay data, though the access will become much more granular under the Directive.Continue Reading A Hop, Skip and a Jump Around Europe | Insights for US Employers Operating Abroad

With special thanks to presenters Michael Michalandos (Australia), Jonathan Isaacs (China), Kenneth Chua (Philippines) and Celeste Ang (Singapore).

Our four-part Global Employment Law Fastpass for US Multinationals 2023 Webinar Series features US moderators welcoming Baker McKenzie colleagues from around the globe as they share the latest labor and employment law updates and trends.

In this…

Special thanks to co-presenter, Jennifer Bernardo.

With a surge in layoffs taking place over the past year, many of those originally hired to diversify the workplace have been impacted, and studies show that inclusion, diversity and equity (ID&E) professionals have been affected by layoffs at a higher rate than others. The harm? Other than…

New Jersey may have started a trend. As of April 10, covered New Jersey employers must now comply with new requirements under the New Jersey mini-WARN Act (see our blog here). New York and California are giving chase, with proposed amendments to New York State’s WARN Act regulations, New York State’s WARN Act, and California’s WARN Act. And New York employers should take note: New York’s WARN Portal is set to go live this month.

Proposed Amendments to NYS WARN Regulations–And a New NYS WARN Portal

The New York State Department of Labor has proposed amendments to the New York State WARN Act (“NYS WARN”) regulations that are intended to account for the post-pandemic workforce, including clarifying how remote work impacts NYS WARN compliance and simplifying language to ensure employers understand their obligations under the law. The Department of Labor is accepting comments to the proposed regulations until May 30, 2023. 

Key items in the proposed amendments to the NYS WARN regulations include:

  • Remote employees included in threshold count: The employers covered by NYS WARN has been expanded to include any employer who employs 50 or more full-time employees, who work at the single site of employment plus individuals that work remotely but are based at the employment site, which may include remote employees in New York as well as other states.
  • Certain notices must be provided electronically: Notices being sent to the New York State Department of Labor Commissioner (“Commissioner”) must be provided electronically and are no longer required to have original signatures.
  • Notice must include additional information: The notice to the Commissioner must include more detailed information about the affected employees, including telephone numbers, job titles, and whether they are paid on an hourly, salary or commission basis. The notice to affected employees must include any other information relevant to their separation, such as information related to any financial incentives an employee may receive if they remain employed by the employer until the effective date of the employment loss, as well as available dislocated worker information.
  • The exceptions for notice are changing:
    • Faltering company exception reduced: The faltering company exception will apply only to plant closings, and will no longer apply to mass layoffs, relocations or reductions in hours.
    • Unforeseeable business circumstances exception expanded: The unforeseeable business circumstances exception will be expanded to expressly include in certain circumstances a public health emergency (including a pandemic) or a terrorist attack.
    • Exception to notice requires determination by Commissioner: The 90-day notice period can be reduced in limited circumstances (including under the faltering company, unforeseeable business circumstances, and natural disaster exceptions) only if:
      • The employer submits a request for consideration for eligibility of an exception to the Commissioner within 10 business days of providing the required notice under NYS WARN to the Commissioner (unless the Commissioner grants an extension);
      • The employer provides a reason for reducing the notice period in addition to any other documents the Commissioner may require; and
      • The Commissioner determines that the employer has established all of the elements of the claimed exception.
  • The calculation of back pay is being clarified for hourly employees: The calculation to be used to determine the average rate of compensation and final rate of compensation for hourly employees is clarified. Such calculation uses the number of hours worked instead of the number of days worked. The days worked method of calculation should still be used for non-hourly employees.
  • The use of payment in lieu of notice is being clarified: Liability for an employer’s failure to give the required notice to employees under NYS WARN will be reduced by amounts paid to an employee in lieu of notice, except where the following conditions are met (then such payments will be considered wages for the notice period):
    • There is an employment agreement or uniformly applied company policy that requires the employer to give the employee a certain amount of notice before a layoff or separation;
    • The employee is laid off without the required notice; and
    • The employer pays the employee an amount equal to the employee’s wages and any benefits for the required notice period.

Continue Reading Employer WARN-ING: Potential Changes to New York’s and California’s WARN Acts Barreling Down the Turnpike