## Facts

- Phillips Petroleum Company and related entities reduced workforces in 1991–1992, including at the Houston Chemical Complex (HCC) and at Bartlesville, Oklahoma.
- At Bartlesville, Phillips laid off over 500 employees and provided 60 days’ advance written notice; four named plaintiffs were among those laid off.
- At HCC, 27 employees were laid off across three Houston-area locations without 60 days’ written notice, in waves: 5 in December 1991, 16 from March–July 1992, and 6 in September 1992.
- Phillips Gas Holding Company, Inc. (PGHC) laid off 40 employees from March–June 1992 across three sites (31 in Bartlesville, 8 in Houston, 1 in Washington, D.C.); some received 60 days’ notice and others did not.
- Several Houston-area plaintiffs were laid off from HCC or PGHC in March or September 1992.
- Affected employees, including plaintiffs, signed releases in exchange for enhanced separation benefits; employees had up to 45 days to consider the releases, which encouraged consultation with counsel.
- Plaintiffs sued without returning the enhanced benefits, seeking to void the releases while retaining the consideration.
- Plaintiffs alleged that layoffs should be aggregated to satisfy WARN’s “mass layoff” thresholds and that the releases did not waive WARN claims.

## Issues

1. Whether any challenged layoffs constituted a WARN “mass layoff” at a “single site of employment” sufficient to trigger the 60-day notice requirement.
2. Whether layoffs at distinct facilities and locations (Houston-area sites and Bartlesville) could be aggregated as a single site for WARN threshold purposes.
3. Whether broad separation releases, exchanged for enhanced benefits, waived WARN claims even though WARN was not named.
4. Whether the appeal was frivolous such that sanctions (attorneys’ fees and double costs) were warranted under Federal Rule of Appellate Procedure 38.

## Decision

- The Fifth Circuit found no error in the district court’s summary judgment for defendants and dismissed the appeal.
- The court held that the layoffs did not satisfy WARN’s “mass layoff” thresholds at any single site of employment and could not be aggregated across distinct sites.
- The court enforced the releases as knowing and voluntary waivers broad enough to encompass employment-related statutory claims, including WARN claims.
- The court awarded attorneys’ fees and double costs under Rule 38, concluding the appeal was frivolous and that counsel’s attacks on opposing counsel and the district court were baseless.

## Legal Principles

- WARN’s mass-layoff notice duties are triggered only when statutory employment-loss thresholds are met at a “single site of employment.”
- Distinct locations that do not operate as one site (e.g., no shared staff or equipment and no functional unity) generally may not be combined to meet WARN thresholds.
- A release supported by consideration and executed knowingly and voluntarily may waive statutory employment claims when its language broadly covers employment- or layoff-related claims; the statute need not be identified by name absent a specific requirement.
- A party seeking to rescind a release generally cannot keep the benefits received while avoiding the release’s obligations.
- Under Federal Rule of Appellate Procedure 38, a court of appeals may award attorneys’ fees and single or double costs when an appeal is frivolous, including where arguments disregard governing requirements and are coupled with unfounded attacks on the court or opposing counsel.

## Conclusion

The Fifth Circuit dismissed the employees’ WARN appeal because the layoffs did not meet WARN’s single-site mass-layoff thresholds and could not be aggregated across separate facilities, enforced the employees’ separation releases as barring WARN claims, and sanctioned counsel with attorneys’ fees and double costs for a frivolous appeal.


Williams v. Phillips Petroleum Co., 23 F.3d 930 (5th Cir. 1994)