11:44
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Simple English definitions for legal terms
faltering-company exception
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A quick definition of faltering-company exception:
Faltering-Company Exception: A rule that says a company doesn't have to give its employees 60 days' notice before shutting down if the company was trying to get money or resources to avoid the shutdown, and if the company thought that giving notice would make it harder to get that money or resources. This rule is part of the Worker Adjustment and Retraining Notification Act.
A more thorough explanation:
The faltering-company exception is a provision in the Worker Adjustment and Retraining Notification Act that allows an employer to avoid giving the required 60-day notice for a plant shutdown under certain circumstances.
To qualify for the exception, the employer must meet two conditions:
- At the time the notice was due, the employer was seeking capital or resources that would have allowed them to avoid a shutdown.
- The employer reasonably believed that providing the notice would have prevented them from obtaining the necessary capital or resources.
For example, if a company is struggling financially and is actively seeking investors or loans to keep the business afloat, they may be able to use the faltering-company exception to avoid giving their employees 60 days' notice of a plant shutdown. However, if the company has already secured the necessary funding or resources, they would not be eligible for the exception.
The faltering-company exception is intended to provide some flexibility for struggling businesses that are trying to avoid layoffs or closures. However, it is important to note that it is not a blanket exemption and must be applied on a case-by-case basis.