COVID-19 not 'natural disaster' that allows for abrupt layoffs - court

(Reuters) - The onset of the COVID-19 pandemic was not a "natural disaster" exempting businesses from a federal law requiring that workers be given advanced notice of mass layoffs, a U.S. appeals court ruled on Wednesday, in a win for three former drilling company employees.

A unanimous three-judge panel of the 5th U.S. Circuit Court of Appeals said the exemption from the Worker Adjustment and Retraining Notification (WARN) Act was meant to apply narrowly to unpredictable geological and meteorological events such as earthquakes and floods, and not to pandemics.

The court ruled in favor of three former employees of U.S. Well Services Inc who say the drilling company abruptly laid off most of its workforce in March 2020, during the early days of the COVID-19 pandemic.

The decision is the first by a U.S. appeals court on whether COVID exempted businesses from the WARN Act, an issue that has divided federal judges. The law requires 60 days notice of mass layoffs, but exempts workforce reductions caused by natural disasters or unforeseen business circumstances.

Business groups including the U.S. Chamber of Commerce had backed U.S. Well Services, arguing in briefs that a ruling against the company would open the door for a flood of similar lawsuits against the many businesses forced to shutter amid the pandemic.

A federal judge in Houston had denied the plaintiffs' motion for summary judgment in the 2020 proposed class action. She said the pandemic was not caused by humans and had infected or killed millions of people, making it a natural disaster.

But the 5th Circuit on Wednesday said the WARN Act exemption, which includes as examples "a flood, earthquake, or the drought currently ravaging the farmlands of the United States," was not meant to apply so broadly.

"Congress knew how to, and could have, included terms like disease, pandemic, or virus in the statutory language of the WARN Act," Circuit Judge Carl Stewart wrote. "That it chose not to justifies the inference that those terms were deliberately excluded."

The panel included Circuit Judges Edith Clement and Jennifer Walker Elrod.

The case is Easom v. U.S. Well Services Inc, 5th U.S. Circuit Court of Appeals, No. 21-20202.

For the plaintiffs: Gabriel Assaad of McDonald Worley

For U.S. Well Services: David Korn of Phelps Dunbar

Read more:

Judges unsure if COVID is 'natural disaster' under layoff notice law

Layoffs triggered by COVID-19 pandemic didn't require advance notice - judge

Biz groups: layoffs amid pandemic didn't require advance notice

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