Dealing with the loss of a job can be brutal. It is an experience that affects you financially and emotionally, especially if you’ve been dismissed unfairly or seemingly without reason. Your employer may offer you a severance package to soften the blow, but it may wind up having its own set of strings attached.
It’s important to understand that Ohio operates under at-will employment, which means that an employer can terminate an employee at any time for any legal reason, unless a contract states otherwise. This also applies at the federal level, as outlined by the Fair Labor Standards Act (FLSA). As a result, employers are not obligated to provide severance packages, also known as separation agreements.
While it’s not uncommon for employers to offer severance agreements, it’s important to understand the reasons behind this. Some employers may see it as an opportunity to do the right thing, maintaining a positive reputation and potentially aiding in future recruitment efforts. This perspective can help you make an informed decision when faced with a severance agreement.
It’s worth noting that some companies have severance pay plans in place, particularly for certain job losses such as those resulting from company downsizing. These plans often consider the employee’s tenure with the company when determining the benefits. It’s also important to be aware that certain severance package pay plans are regulated by the Employee Retirement Income Security Act of 1974 (ERISA), which requires employers to draft these plans and provide summaries to the covered employees.
Most of the time, however, you’ll be offered a termination agreement in exchange for a release. These instances typically occur when employees resign for “good reason,” which often means that the employer negatively alters their working conditions by demoting them, reducing their pay, or increasing their duties.
If you sign these agreements, you give up your rights to any future claims. You do have protection, however, in instances when the employer refuses or fails to pay the agreed severance. You also have the right to file a lawsuit for breach of contract for the amount stipulated by the severance agreement.
Negotiations take place at the end of your employment. Employers should be ready to pay severance in an amount equal to the value of the claims you release by signing the agreement.
Putting a price on claims requires considering how much the employee would receive in court if they won, minus the legal fees. However, accurately predicting the value of a claim is difficult because of all of the variables involved with going to court. If you have an employee rights lawyer by your side, they can negotiate a fair agreement, using their extensive experience to understand claim values and give you an accurate range.
There can be other severance terms that need to be negotiated, including agreements addressing the following:
All severance agreements must provide details on the amount of severance pay the employer will receive and how it will be paid, whether in one lump sum or in many payments over time.
A severance package often includes non-compete agreements. These agreements restrict an employee’s right to work for similar companies for a certain time and within a specific geographical area. Some severance packages also include an agreement for the employer to offer help in finding a new position.
Ultimately, given the complexities of employment contracts and severance pay laws, you need a reliable employment lawyer through the entire process. And at Oliver Law Office, we’re ready to provide you with the guidance you need.
At Oliver Law Office in Columbus, OH, our lawyers are ready to help you understand your rights if your employment has been terminated. We will carefully assess why you were terminated so that we can negotiate a fair severance arrangement for you.
Your lawyer can tell you whether you should file a claim for compensation if you’ve been unjustly terminated. That is critical, as signing a release in a severance package prohibits you from making potential claims against the employer, even if you were unaware of your ability to make those claims at the time of the signing.
One of the tactics employers often turn to in crafting these agreements is putting an arbitrary time limit on the offer, which can rush you into accepting an offer that may not be beneficial. A severance pay lawyer will look out for your rights by performing a severance review, ensuring that the amount the employer offers is fair and worth accepting. They will prevent your employer from forcing you to sign the agreement immediately if it’s not in your best interests.
When you choose to work with Oliver Law Office, you can leave all the tough negotiations to us. We have experience dealing with all levels of termination agreements, including executive severance.
If you are older than 40, retaining the services of an employment attorney after termination is essential, as the Older Workers Benefit Protection Act (OWBPA) applies. This federal law amends the Age Discrimination in Employment Act (ADEA), which itself protects people from being discriminated against based on age.
The OWBPA states that employees over 40 must be given at least 21 days to sign a severance agreement and another seven days to revoke it if they do so. If an employer doesn’t provide these grace periods, it violates the law.
The aftermath of losing your employment can be devastating, and employers know that. If they’re worried about you filing a claim against them, they’ll do everything possible to safeguard their interests, which could mean offering you a severance package.
Signing a severance agreement quickly can be tempting, thinking it offers security after losing your job. Instead, turn to lawyers who can parse through all of the legal language. We offer virtual consultations and house calls to make the process as simple as possible.
