Layoff announcements increase in N.Y.

CAPITOL — Warning: New York employers are increasingly announcing mass layoffs and plant closures.

With New York’s economy floundering, a growing number of large companies statewide are issuing Workforce Adjustment and Retraining Notifications, also known as WARNs. During the first half, the state Department of Labor received 66 WARNs from businesses either laying off at least 50 workers, relocating operations or closing a plant.

That six-month tally marks a 15.8 percent increase over the 57 WARNs New York private employers issued during same period of last year and a 29.4 percent jump from 51 during the first half of 2004, according to the Labor Department.

The Capital Region fared much better than the state as a whole, with only two WARNs in the first half of this year, down from six a year earlier.

“We have certainly kept our rapid response teams busy, but as the numbers show, we are seeing an increase in WARN notices,” said state Labor Department spokeswoman Ruth Pillittere.

Whenever a business issues a WARN, local work force assistance units, or “rapid response teams,” are deployed to affected facilities. There, they provide unemployment and re-employment assistance services.

As economic malaise last month pushed New York’s unemployment rate to 5.2 percent from 4.4 percent a year earlier, lawmakers in Albany passed legislation that would establish a state WARN system. The bill, which was sent to Gov. David Paterson’s desk Friday, would broaden notification provisions of the two-decade-old federal WARN system.

“There’s a significant amount of stress on workers and families. It’s a hardship because of the uncertainties. … It’s only fair” employees are given more time to prepare for layoffs, said Assemblywoman Patricia Eddington, a Suffolk County Democrat, the bill’s sponsor.

Under the proposed state system, businesses that employ over 50 would have to issue a WARN 90 calender days prior to closing a plant or laying off at least 25 workers. The federal system applies to businesses that employ 100 or more. They must issue WARNs 60 calender days prior to closing a plant or laying off at least 50.

The Labor Department commissioner would enforce the state WARN law and make determinations regarding violations and penalties. Businesses could face a civil penalty of $500 per day of violation. They would also be liable for back pay and other employee benefits for up to 60 days of a violation.

The legislation promises to provide workers affected by mass layoffs and plant closures with more time to get their finances in order and undergo retraining for future job prospects. It would also provide the Labor Department’s rapid response teams with more time to assist affected employees.

Lawmakers also hope that extra time will increase affected workers’ chances of finding new jobs and decrease their reliance on unemployment benefits. Paterson has until Wednesday to sign the bill. Paterson spokesman Morgan Hook said the bill is under review.

The state’s business community opposes the legislation because of the added regulatory burdens the extended notification window would impose on companies. The inclusion of small businesses into a WARN system would add to those burdens, said Michael Elmendorf, the state director for the National Federation of Independent Businesses, an Albany trade organization.

“This is not the right time to be imposing new burdens,” Elmendorf said.

Kenneth Polasky, the Business Council of New York State’s senior director of government affairs, said the state WARN rules “could put the entire operation in jeopardy” at some struggling businesses. His Albany trade organization estimates that 13,000 state businesses could fall under the proposed regulatory restrictions.

“I don’t think it’s going to change things, but the more notice the better,” said Dan Gentile, the executive director of the Capital District Workforce Investment Board, a quasi-state and -federal organization that assists Labor Department rapid response teams.

Although WARNs are up statewide, they are down in the Capital Region. Employers here issued only two WARNs during the first half of the year, compared with six during the same period of last year and three in 2004, according to the Labor Department.

But despite the lower WARN volume, the region’s unemployment rate has risen almost as rapidly as the state’s rate. In June, the region’s unemployment rate was 4.9 percent, compared with 3.8 percent a year earlier.

Earlier this month, The Newark Group issued a WARN, saying the Cranford, N.J.-based cardboard manufacturer will close its Bennington Paperboard in North Hoosick and lay off 64. The northern Rensselaer County mill is slated to close Aug. 30. Overcapacity concerns are prompting that closure.

The region’s other WARN during the first half came from Portola Packaging, which announced in May plans to close its Clifton Park plant and lay off 78. The Batavia, Ill., plastic drink container manufacturer said it wants to consolidate its operations into three “anchor” plants on the East and West coasts and in the Midwest. The last day of work for most of the Portola employees in Clifton Park was Sunday.

Just outside the region, the Callaway Golf Co. in May issued a WARN concerning its Gloversville golf ball manufacturing plant. The Carlsbad, Calif.-based Callaway said it will lay off 118 because it needs to manufacture and ship from plants closer to worldwide markets.

New York is in line to join a growing number of states that have recently established their own WARN laws, including New Jersey, California and Illinois.

The U.S. House of Representatives in October passed legislation that would extend the WARN window to 90 days. However, the bill sponsored by Rep Charles Rangel, D-N.Y., requires employers to issues notices when they lay off at least 50 workers.