You asked is there a state penalty for a defense contractor who lays off employees in Connecticut when it moves contract work out of the state.

Generally, there is no law or other authority for the state to penalize a defense contractor for moving work out of the state and laying off Connecticut workers. But the state may put conditions on aid, tax breaks, or other incentives it gives to individual companies to operate or expand in the state, and it may seek to reclaim the aid if the company does not remain in the state. Such conditions are usually part of an assistance contract and are not statutory. This report will address the question assuming the company involved does not get state aid.

Last session the legislature considered several bills that would have restricted outsourcing, although most of the bills prohibited outsourcing of work to be done under state contract (see OLR report, 2004-R-0640).

On the federal level, the Worker Adjustment and Retraining Notification (WARN) Act requires employers of 100 or more full-time workers to give 60-day advance notice of a plant closing or major layoff. The law requires the notification to be given to the local chief elected official, the State Department of Labor, and the employees’ union or, if they are not unionized, to each employee (Public Law 100-379, 29 U. S. C. 2101, et seq. ).

WARN covers employers with 100 or more full-time employees who intend to:

Employers may be subject to fines in the form of employee compensation if they are found to have violated this law. For more on the WARN Act see the state DOL web site:

http: //www. ctdol. state. ct. us/progsupt/bussrvce/rrwarn. htm.

JM: dw