ANALYSIS

Anderson seeks to strike Plaintiffs’ Cross-Motion for Partial Summary Judgment on Issue of

Existence of Mass Layoff, arguing that Federal Rule of Civil Procedure 56 does not allow summary
judgment be entered on an issuc as sought by Plaintiffs. Instead, it only allows summary judgment on
aclaim.

Federal Rule of Civil Procedure 56(d) allows the granting of partial summary judgment on less
than a whole claim. See Fed. R. Civ. P. 56(d); Zapata Hermanos Sucessores v. Hearthside Baking Co.,
313 F.3d 385, 391 (7" Cir, 2003). Accordingly, Defendant’s Motion to Strike Plaintiffs’ Cross-Motion
for Partial Summary Judgment on Issue of Existence of Mass Layoff is denied.

The WARN Act requires employers of 100 or more full-time employees to give at least sixty
days’ advance notice of plant closings and mass layoffs to affected employees. See 29 U.S.C. §2102(a).
The only issue disputed by the partics in the instant casc is whether the layoffs at the 33 West Monroe
site constituted a “mass layoff” as required by the WARN Act.

The WARN Act defines a “mass layoff” as:

(3) ... a reduction in force which ~
(A) is not the result of a plant closing; and
(B) results in an employment loss at a single site of employment during
any 30-day period for —
(i)(1) at least 33 percent of the cmployees (excluding any part-time
employees); and
(I) at Icast 50 employces (excluding any part-time cmployees); or
(ii) at least 500 employees (excluding any part-time employees)
29 U.S.C. § 2101(a)(B)(3). To trigger the notice requirement under this section, if the employer lays

off fewer than 500 employees in an action unrelated to a plant closing, the number of employces laid off

must exceed 50 and must also exceed 33 percent of the total number of employees, The Department of


any 90-day period reach the minimum numbers and thus trigger the notice requirement. If an employer
only need be concerned with 2102(d) ifless than 50 employecs were laid off within a 30-day period, the
Department of Labor could have indicated that this inquiry first be made, Instead, the Department of
Labor informs employers to add the employees laid off in a 90-day period to determine if the minimum
numbers have been reached.

Defendant also cites to other district courts that have found that if the statutory minimum of fifty
employees is met, the requisite statutory period is thirly days. The cases cited are not persuasive. In
Reyes v. Greater Texas Finishing Corp., 19 F. Supp. 2d 709 (W.D. Texas 1998) (Reyes), the court found
“falfter a thorough reading of the statute, regulations, legislative history and relevant case law...” that
since the statutory minimum of fifty persons was met, the requisite statutory period was thirty days. In
support of its holding, the Reyes court quoted the above Senate Amendment and cited to 29 U.S.C. §
2101(a)(3).. However, the Reyes court failed to indicate whether 2101(a)(3)(B)G)(U) had also been
satisfied and did not address any of the other legislative history cited above.

Similarly, in Washington v. Aireap Indust. Corp., 1992 WL 547993 (D. S.C. July 8, 1992), the
court failed to address whether 2101(a)(3)(B)(i)(L) had also been met when limiting the statutory period
to thirty days. Furthermore, the Washington court was not making a decision on the merits of the
plaintiff's WARN Act claims but was deciding whether class certification was appropriate. See also,
Kelly v. Tech Inc., 195 F.R.D. 48 (S.D. Fla.) (failing to address 2102(a)(3)(B)(i)(I) requirement and not
addressing any argument that 90-day period was appropriate).

Lastly, under Defendant’s interpretation, an employer of a large number of employccs, such as
the Defendant, could evade the requirements of the WARN Act by always laying off over 50 employces

in a 30-day period but making sure that the number of employees laid off in a 30-day period did not



20 C.F.R. § 639.5(a)(1).

The parties do not dispute that there was no thirty-day period in which 500 full-time employees
experienced an employment loss. The largest number of full-time losses in any thirty-day period was
465. The parties also do not dispute that there was no thirty-day period in which 33 percent of the full-
lime employees suffered an employment loss, as 465 is less than 33 percent of the 3,000 plus full-time
employees at the 33 West Monroe employment site. Based on these undisputed facts, a mass layoff did
not occur under 29 U.S.C. § 2101(3).

The parties do dispute whether 29 U.S.C. § 2102(d) applies. Defendant argues that Scction
2102(d) only applics if less than fifty employees were terminated in a thirty-day time period. Under
Defendant's construction of 2102(d), the “minimum number of employees specified in section ...
2101(a)(3)” applies only if 2101(a)(3)(B)(i)(ii), more than 50 employces, is not met, In support of this
construction, Defendant argues that the provision “minimum number” only speaks in the singular, not
the plural; and between, 50 and 500, there is only one minimum. However, as set out above,
2102(a)(3\(B)(i)(]) provides “at least 50 employees”; and subsection III provides “at feast 500
employees”. (Emphasis added). Both provide a minimum number in establishing different bases for
determining a “mass layoff”.

Plaintiffs argue that Section 2102 establishes criteria for a mass layoff independent of Section
2101(3) if the layoffs (1) affected two or more groups, (2) ncither 2101(a)(3)(B)(i) or 2101 (a)(3)(B)(ii)
are met , and (3) the terminations were not the result of separate and distinct actions and causes.

A court “should not construe a statute in a way that makes words or phrases meaningless,

redundant, or superfluous.” See Unites States v. Franz, 886 F.2d 973, 978 (7th Cir. 1989).



Labor regulations governing WARN enforcement provides that these figures be calculated at a
“snapshot” date, the date notice is first required to be given. See 20 C.F.R. § 639,5(a)(2).
The WARN Act also provides for aggregating the number of laid-off employees. Section
2102(d) states:
(d) Determinations with respect to employment loss

For purposes of this section, in determining whether a plant closing or
mass layoff has occurred or will occur, employment losses for 2 or more
groups at a single site of employment, cach of which is less than the
minimum number of employees specified in section 2101(a)(2) or (3) of
this title but which in the aggregate exceed that minimum number, and
which occur within any 90-day period shall be considered to be a plant
closing or mass layoff unless the employer demonstrates that the
employment losses are the result of separate and distinct actions and
causes and are not an attempt by the employer to evade the requirements
of this chapter.

29 U.S.C. § 2102(d).
The Department of Labor regulations provide guidance to employers for deciding whether notice is
Tequired --

In order for an employer to decide whether issuing notice is required, the
employer should —

(i) Look ahcad 30 days and behind 30 days to determine whether
employment actions both taken and planned will, in the aggregate for
any 30-day period, reach the minimum numbers for a plant closing ora
mass layoff and thus trigger the notice requirement; and

(ii) Look ahead 90 days and behind 90 days to determine whether
employment actions both taken and planned each of which separately is
not of sufficient size to trigger WARN coverage will, in the aggregate
for any 90-day period, reach the minimum numbers for a plant closing
or a mass layoff and thus trigger the notice requirement. An employer
is not, however, required under scction 3(d) to give notice if the
employer demonstrates that the separate employment losses are the
result of separate and distincl actions and causes, and are not an attempt
to cvade the requirements of WARN.



33 percent of the employees at a particular employment site also applies to this section [2102d], The
‘33 percent’ requirement was inadvertently omitted from the language approved by the senate.” H.R.
Conf. Rep. No. 100-576, at 1050 (1988). This Conference Agreement fails to support Defendant’s
interpretation that 2101(a)(3)(B)(i)(I) must first be met before any other part of 2101(a)(3)(B) is
analyzed. However, it docs support the interpretation that there are two distinct methods of mccting,
and not meeting, the requirements of 2101(a)(3) as set out above.
Further support for the interpretation adopted by the Court is found in the Conference Agreement
to the Senate Amendment concerning the definition of “mass layoff’. The Conference Agreement
modified the Senate Amendment so that the 33 percent requirement only applies to mass layoffs that
involve more than 49 but Icss than 500 cmployees. The Conference found that:
layoffs involving 500 or more people are likely to cause significant
economic disruption in local communities, as well as the obvious
disruption for the individuals involved. Thus, the rationale for advance
notice is strong — the need for individuals and communitics to begin
planning for dislocation before the dislocation occurs. The justification
fora 33 percent requirement for layoffs before notice is required has been
the representation by busincss interests that small layoffs of 50 or 100 or
even 200 employces at a single site with perhaps a workforce of perhaps
a thousand or more employecs are such a regular part of business that
requiring notice in these circumstances would be unduly burdensome.
Because a layoff of 500 cmployees at a site of cmployment is a
significant and unusual action, even in a large workforce of 2000 or more
employees, the requirement of advance notice in these situations should
not place an undue burden on employecs.

H.R. Conf. Rep. 100-576, at 1046 (1988). Thus, Congress specifically chose two different definitions

of mass layoff that required different criteria that were not interrelaicd.

Defendant’s interpretation is also contrary to the Department of Labor’s regulation cited above

which informs employers to look ahead and back 90 days to determine whether employment actions,

each of which scparately are not of sufficient size to constitute a mass layoff, will in the aggregate for


“Minute Order Faro (06°97)

United States District Court, Northern District of Lllinois

Ni iy i Sitting Judge if Oth
inne Magistrate ude Jobn W. Darrah than Aeigued Judge
CASE NUMBER 02 C2689 DATE 5/22/2003
CASE NANCY J. ROQUET vs. ARTHUR ANDERSON LLP
TITLE

(Inthe following box (a) indicate the party filing the motion, ¢.g., plaintiff, defendant, 3rd party plaintiff, and (b) state briefly the nature
of the motion being presented, |

MOTION:

DOCKET ENTRY:

(l) uo Filed motion of [ use listing in “Motion” box above.)

(2) oO Bricfin support of motion duc

(3) uo Answer bricfto motion due____.. Reply to answer brief duc.

(4) oO Ruling/Hearingon set fora

(3) a Status hearing[held/continued to] [set for/re-sct for]on__ set for_ at

(6) va] Pretrial conference|held/continued to] [set for/re-set forlon__—ssetfur___ at.

(7) fl Trial[sct for/re-set for]on at

(8) Oo [Bench/Jury trial] [Hearing] held/continued to __at

(9) a This case is dismissed [with/without] prejudice and without costs[by/agreement/pursuant to]
CHFRCP4(m) OLocal Rule 41,1 ClFRCP41(a\1) (1 FRCP41(a)(2).

ao «6 [Other docket entry] Status hearing held and continued to 8/13/03 at 9:00 a.m. Defendant’s

responsc to plaintiffs renewed motion for class certification class action [47-1] to be filed by 6/24/03.
Plaintiff's reply to be filed by 7/8/03, Enter Memorandum Opinion And Order, Defendant's motion to
strike plaintiffs’ cross-motion for partial summary judgment on issue of existence of mass layoff is
denied. Defendant’s motion for summary judgment is denied. Plaintiff's cross-motion for partial
summary judgment on issue of existence of mass layoff is granted.

(i ow (For further detail sec order attached to the original minute order.

No notices required, advised in open court

requit a
No notices required. mand of ess

Notices mailed by judge's staff. " AY 9 ” 2en?

Notified counsel by telephone, date dodkatt
V_ | Docketing to mail notices ~
Mail AO 450 torm. a dextcflany ih

Copy to judge/magistrule judge.

sate mited novice

courtroom,
LG deputy's
initials

Date/time received in : ;
U Seentyal Clerk's Office “sr walling deputy inals



Accordingly, Anderson’s Motion for Summary Judgment is denied; and Plaintiffs’ Motion For
Partial Summary Judgment on Issue of Exisicnce of Mass Layoff is granted,

For the foregoing reasons, Defendant’s Motion to Strike Plaintiffs’ Cross-Motion for Partial
Summary Judgment on Issue of Existence of Mass Layoffis denied. Defendant’s Motion for Summary

Judgment is denied. Plaintiffs Cross-Motion for Partial Summary Judgment on Issue of Existence of

Mass Layoff is granted. ;

“3
Dated: Meg a2, 202

United States District Judge

11



exceed 500, For example, a large employer could layoff 499 people every 31 days and avoid the
disclosure requirement, including Section 2102(d), as long as 499 employees did not constitute
33 percent of the employees. Such result would be contrary to Congress’s purpose in enacting the
statute, including 2102(d), which is intended to prevent the cvasion of the statute by the manipulation
of the number of employees laid off.
CONCLUSION

A mass layoff occurs pursuant to Section 2102(d) if (1) employment losses for two or more
groups ata single site of employment; (2) cach of which is less than the minimum number of employecs
specificd in section 2102(a)(2) or (3), failing to mect the requirements of 21 02(a)(2) or
2102(a)(3)(B)(i(T) and 2102(a)(3)(B)(i)(I)) or 2102(a)(3)(B)(ii); (3) but which in the aggtegate exceed
that minimum number within any 90-day period shall be considered a plant closing or mass layoff; (4)
unless the employer demonstrates that the employment losses are the result of separate and distinct
actions and causes and are not an attempt by the employer to evade the requircments of this chapter.

As stated above, the parties do not dispute that a mass layoff did not occur as defined in
2101(a)(3). Therefore, based on the above statutory construction, a determination of whether a mass
layoff occurred based on Section 2102(d) must then be made. The undisputed facts show that there were
employment losses for two or more groups at 33 West Monroe, cach of which are less than the minimum
number of cmployees specified in section 2102(a)(3), but which in the aggregate of 90 days excced 500
employees, specifically, 635 employees.

Furthermore, Anderson does not present any undisputed facts or argument that the employment
losses were the result of separate and distinct actions and causes and were not an attempt by Anderson

to evade the requirements of this chapter.

10



Contrary to Defendant’s argument, the plain language of Section 2102(d), “cach of which is
less than the minimum number of employees specified in section 2101(a)(2) or (3), does not support
the narrow interpretation that only 2101(a)(3)(B)(i)(1)) sets out the minimum number of employees
referenced in 2102(d) as fifty. Congress chose to usc “2101(a)(3)” in the statute. Congress did not, but
could have easily, refer specifically to Section 2101(a)(3)(B)(i)() or simply 50 cmployees in referring
to the minimum number in Section 2101(a)(2). Section 2101(a)(3) allows two different definitions of
a mass layoff, either of which, if met, require notice be given. Ifa layoff meets the requirements of
2101(a)(3)(B)(i), which requires both an employment loss of 33 percent and a minimum of “at least 50
employees”, then 2101(a)(3)(B){ii) need not be addressed, and 2102(d) would not apply. Similarly, if
a layoff mects the requirements of 2101(a)(3)(B)(ii), which only requires a total of a minimum of “at
least 500 employecs” Laid off, then 2101(a)(3)(B)(i) need not be addressed, and 2102(d) would not apply.
Clearly, Congress intended that Section 2102(d) only applies if 2101(a)(2) or (3) are not met.
Although no reference beyond the language of the statute is necessary, a discussion of legislative

history raised by the Defendant is appropriate. Defendant cites to a Senate Amendment to Section 2102
to support its argument, This Amendment stated:

The Senate Amendment provides for the determination of a plant

closing or mass layoff based on aggregation of smaller employment

losses. Under the Amendment, employment losses at a single site for 2

or more groups of employees, each of which is less than 50 employces,

but which in the aggregate total at least 50 employees, that occur within

a 90-day period, will be considered a closing or layoff subject to

notification...
H.R. Conf. Rep. No. 100-576, at 1050 (1988).
However, a closer look at the legislative history of the WARN Act fails to support Defendant’s

narrow reading of the exception and the Senate Amendment. The Conference Agreement for the above

Senate Amendment clarified that “the requirement that a mass layoff of 50 to 499 employees must affect


At all relevant times between February 1, 2002, and April 8, 2002, the number of full-time
employees at 33 West Montoc was in exccss of 3,000. (Def.’s 56.1(a)(3) Statement 744), In the thirty-
day period beginning with the period April 23, 2002, through May 22, 2002, and for several thirty day
periods beginning cach subsequent day thercafter, the number of full-time employees involuntarily
terminated in cach thirty-day period excecded 50. (Id., 45). In the thirty-day period beginning with
the period April 8 2002, through May 7, 2002, and going forward through the thirty-day period cnding
July 30, 2002, the number of full-time Anderson employees involuntarily terminated at 33 West Monroe
was less than 500. (Id., {| 46).

The largest number of full-time employees terminated from its 33 West Monroe employment
site in any thirty-day period with the period of April 8, 2002, through May 7, 2002, and going forward
through the thirty-day period ending July, 30, 2002, was 465. (Def.’s 56.1(a)(3) Statement 4 47). In
each thirty-day period beginning April 8, 2002, through May 7, 2002, and continuing through a thirty-
day period ending July 30, 2002, the number of Anderson employees involuntarily terminated from its
33 West Monroe employment site was less than 33 percent of the full-time cmployees employed at that
employment site. (Id., {| 48).

Anderson terminated 436 employees on 20 different dates at its 33 West Monroe employment
site between April 23, 2002, and May 22, 2002. (Plaints.’ 56.1(b)(3) Statement 53). Anderson
terminated 154 cmployees on 22 different dates at its 33 West Monroe employment site between
May 23, 2002, and June 21, 2002. (Id., J] 54), Anderson terminated 45 employecs on 19 different dates
al its 33 West Monroe employment site between June 22, 2002, and July 21, 2002. (Id., 55).

Anderson gave Roquet notice on April 8, 2002, that she was terminated as of April 23, 2002.

(Plaints.’ 56.1(b)(3) Statement 56). Anderson gave Robinson notice on April 8, 2002, that she was

terminated as of May 15, 2002. (id., 1 57).



On March 14, 2002, the United States Department of Justice made its indictment of Anderson
on certain criminal charges. (Def.’s 56,1(a)(3) Statement 724). On or about April 8, 2002, notices were
sent to a number of Anderson’s employecs, including some cmployees at its 33 West Monroc
employment site, notifying each cmployee to whom a notice was addressed that his or her employment
would be terminated at a future date after a specified period of continued employment, referred to as
“job search” time. Based on business needs, some employees’ employment was extended beyond the
initial anticipated termination date indicated in their notice. (Id., 7 26). Decisions as to who should
reccive notice on April 8, 2002, of future termination at each Anderson site were made by local
management, based on their best assessment of which employees were least critical to serve what
business was anticipated to remain after the indictment. (Id., 127). During his or her paid job search
period, each employce continued to be an employce of Anderson. His or her employment terminated
at the carlier of either (1) the end of his or her job search period, (2) his or her voluntary termination of
employment or (3) the receipt of an offer of replacement employment by another firm. (Id., { 29).

The notice Anderson gave a number of employees on or about April 8, 2002, did not terminate
any employee’s employmentas of that date. (Def.’s 56.1(a)(3) Statement 430), The carliest termination
of employment pursuant to the April 8, 2002 notices occurred on April 23, 2002. This was because
every employee was given at least two weeks of paid job search employment after April 8, 2002. (Id.,
431). On Or about April 11, 2002, Anderson sent several local government offices notices that it
anticipated that there may be layoffs at certain employment sites, including 33 West Monroe, either in
excess of 500 or 33 percent of ils workforce at those employment sites over a 180-day period. No
notices sent to government offices indicated a particular number of anticipated layoffs in a thirty-day

period. (Id., § 32).



UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION
NANCY J. ROQUET and CORETTA ROBINSON, +)
Plaintiffs, ‘ No. 02 C 2689
vy. } Judge John W. Darrah
ARTHUR ANDERSON LLP, }
Defendant. )

MEMORANDUM OPINION AND ORDER

Plaintiffs, Nancy J. Roquct (‘‘Roquet”) and Coretta Robinson (“Robinson”), brought a class
action suit against Defendant, Arthur Anderson LLP (“Anderson”), alleging Defendant violated the
Worker Adjustment and Retraining Notification Act (“WARN Act”), 29 U.S.C. § 2101-2109, Presently
before the Court are: (1) Defendant’s Motion to Strike Plaintiffs’ Cross-Motion for Partial Summary
Judgment on Issue of Existence of Mass Layoff, (2) Defendant’s Motion for Summary Judgment, and
(3) Plaintiffs’ Cross-Motion for Partial Summary Judgment on Issue of Existence of Mass Layoff.

BACKGROUND

Anderson was engaged in the business of accounting, auditing and tax and business and
speciality consulting in various locations in the United States. (Def.’s 56.1(a)(3) Statement 3). In
Marchand April 2002, Anderson had employed sites in more than cighty locations in the United States,
including its employment site at 33 West Monroe Strect, Chicago, Illinois, (Id., | 8). Anderson’s
employecs were assigned to one employment site. (Id, 11). Anderson’s employment site at 33 West
Monroc was not contiguous with any other Anderson location. (Id., J 12). As of mid and late March
2002, Anderson employed in excess of 25,000 persons in its more than eighty employment sites

throughout the United States. (Id., J 25).