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Legislative Memo

BILL:

A.10042 (Eddington)

Support

SUBJECT:

Work Reduction Notice Act

 

DATE:

April 23, 2002

 

The Business Council of New York State, whose membership includes almost 4,000 member firms as well as hundreds of chambers of commerce and professional trade associations, has reviewed the above mentioned legislation and opposes its enactment.

This legislation would amend New York State's Labor Law to include a requirement that in the event of a reduction in hours for reasons other than disciplinary, voluntary departure or retirement, employers employing over 100 employees provide a 60 day notice to the employees if ten or more percent of employees are reclassified as part-time from full-time, or are changed from a status entitling them to benefits, or the reclassification of more than twenty employees at any one work location.

The federal Worker Adjustment and Retraining Notification Act (WARN) has been in effect since 1989 and provides for a 60 day notification to employees prior to a wide-range of workforce reductions implemented by employers. WARN also provides that unions, chief elected officials and state dislocated worker units (our Department of Labor) be notified in the same time frame. This bill contains some of the same employer requirements but goes far beyond WARN in the reasons requiring notification.

Although no notice is required in the event of natural disaster or act of war, these are not situations where an employer would typically take the drastic action outlined in this bill. Rather, the actions taken might happen because of a sudden turn in business or the economic cycle causing, among other belt tightening measures, the necessity to change employees from full time to part time status resulting in the loss of benefits. This more realistic scenario is not even acknowledged in this bill. The federal WARN act does take unforeseeable business circumstances into account.

The federal WARN act already covers what we have seen as the typical work reduction and plant closing situations, and places notification requirements on New York State employers. A. 10042 focuses only on employees whose hours are reduced and/or lose their benefits, but remain employed, and then fails to take into account the principal reason why this might happen.

For these reasons, The Business Council opposes this legislation and respectfully urges that it not be enacted by the Assembly.