WARN Act Notifications
WARN Act data details advanced notifications from companies about mass layoffs or plant closings. A unique leading indicator of business distress, WARN Act data enables lenders to proactively manage their risk exposure.
The Worker Adjustment and Retraining Notification (WARN) Act is a federal law that mandates companies that employ more than 100 employees to give 60 days advance notice if they intend to lay off more than 50 employees at a single site. States have their own extensions of the WARN Act, which are often more stringent than federal requirements. Each notification details the layoff or plant closure date, the number of employees impacted, as well as the reason behind the event. Because the WARN Act data indicates forthcoming negative business activity, this data serves as an early warning flag for at-risk businesses.
How to use this data
WARN Act data provides essential signal for credit risk monitoring, as the data allows you to identify distressed customers and mitigate risk. You can also integrate this data into underwriting processes to better understand an applicant’s risk profile. The data can be leveraged for broader trend exploration across industry, geography, and layoff or closure causes.
Sample API output
"reason": "Unforeseeable business circumstances prompted by COVID-19"
WARN Act notifications are often the first place we see a business is struggling. Other indications of distress aren’t usually filed until businesses have been non-operational for quite some time. This is what makes WARN Act data so unique.