Severance pay, yay or nay?

December 5, 2012 9:18 PM

Should I ask for severance pay in California?

I was laid off/fired from my job last Thursday. I had been on a performance plan for about three months and was finally let go. I think that my manager and his manager were completely unfair, but it was ultimately a bad fit for me and leaving gives me a sense of relief.

I wasn't offered severance pay, but the HR person did not have my final check ready during the firing meeting - it was over nighted to me. A few people I've talked to asked me if I got severance pay. I hadn't asked for it and they didn't offer it and I'm wondering if I'm eligible or if it's customary in cases like this. It looks like there are a few special conditions for people over 40, which I am, but I'm not sure what, if anything, is appropriate in this case.

posted by anonymous to work & money (11 answers total)

There really is no "eligible," since there are no U.S. laws which I know which require it to be paid.

As far as customary, yes it's absolutely customary to pay two weeks at the least when laying someone off, and they are assholes for not doing so. The fact that you were on a "performance plan" gives them a little wiggle room, but any company with even a bit of class will still give two weeks in that situation, even if it's just to make sure you don't sue them.

But, there's really no way you can force them to pay it if they don't want to, unfortunately.

One caveat: Did they pay you for the vacation days you had accrued? The law absolutely requires they do so, and if they did not I recommend demanding they do so, then filing a wage claim with the state government if they refuse.
posted by drjimmy11 at 9:48 PM on December 5, 2012 [1 favorite]

Looks like no.

Unless an employment contract exists, or a requirement of the Warn Act, employers are not required to pay California severance pay or provide their employees with employee benefits and severance.

I am assuming you have checked your contract and it did not say anything about severance.
posted by restless_nomad at 9:48 PM on December 5, 2012

(For further reference, here is info on the WARN Act, which has to do with mass layoffs and plant closings, neither of which sound like they apply.)
posted by restless_nomad at 9:50 PM on December 5, 2012

If the question is should you ask, then I would act surprised your final check had no severance and you were expecting four weeks in exchange for an agreement not to sue or reveal corporate information. See what they say. It might start a negotiation
posted by JohnnyGunn at 10:54 PM on December 5, 2012 [1 favorite]

You either get it or you don't. You should be paid for any vacation time remaining, but there is no rule for severance. In my experience, they only pay severance if they want you to play nice when you leave - ie. don't share company secrets, don't work for the competition. If you're just a grunt, you are unlikely to ever receive severance pay.
posted by The Light Fantastic at 12:14 AM on December 6, 2012

The "performance plan" is a scam to get rid of someone they don"t like without paying severance or getting sued. If you felt they were undervaluing your work unfairly, you should have refused the plan, disputed their grounds for it and ideally claimed it was harassment of some kind.
posted by w0mbat at 1:19 AM on December 6, 2012

The "performance plan" is a scam to get rid of someone they don"t like without paying severance or getting sued. If you felt they were undervaluing your work unfairly, you should have refused the plan, disputed their grounds for it and ideally claimed it was harassment of some kind.

1) There is no general right to severance pay, only various corporate policies, so they don't need a performance plan to avoid severance.
2) I guess documenting performance issues is on some level an attempt to avoid lawsuits, but that puts the cart before the horse.
3) There is generally no such thing as "refusing the plan." You can disagree with contents, but that doesn't really change anything. To the extent it sets out specific measurable performance objectives, you can ensure that you meet them which might protect you.
4) I assume that you are hoping to claim it was discrimination, not harassment. Employers have pretty broad latitude to "harass" their employees for performance related issues.
posted by Lame_username at 1:49 AM on December 6, 2012 [1 favorite]

Everyone else is right about you not being owed severance pay. Their only legal obligation is to pay you for work you've already done plus your vacation days (your average daily earnings * # of vacation days you had accrued when fired).

What you might be able to get out of them is unemployment insurance. You should file for it, since you were fired, and if you don't get it you could talk to someone like these people about appealing the decision.
posted by Aizkolari at 6:40 AM on December 6, 2012

Lame_username : the poster states that they are over 40, so obviously I am talking about harassment due to their age, ie discrimination against a member of a protected group.
HR issues are always about avoiding a lawsuit.

The performance plan is designed to provide documented grounds for dismissal that make a discrimination lawsuit hard to win. This involves trying to get the employee to agree to the plan in writing, as that makes it far more effective as evidence.

Severance pay is a different tool for getting rid of a person while avoiding a discrimination lawsuit, as in order to get the money the employee is required to quit and sign an agreement not to sue.

Without the potential for lawsuits, neither thing would exist. People would just get fired.
posted by w0mbat at 9:02 AM on December 6, 2012

As said above, severance isn't required it is merely a tool that companies use to make you not as angry when you are fired or laid off. I've worked at companies that gave severance to every involuntary term and companies that only gave it for layoffs and companies that gave it based on the presumed risk and how much they wanted the person to go away.

If you believe you were fired because you are over 40 then you should talk to an employment lawyer, don't be surprised when that lawyer doesn't give a crap about the over 40 thing (because that is really hard to prove) and wants to focus on things like if you ever worked OT without getting paid properly, etc. Because that is where the real money is...for them.

You weren't a part of a mass lay-off or anything like that, so WARN doesn't apply. Really it just sounds like you were fired either for not living up to their expectations or because you weren't a good fit. Sounds like you aren't super bummed about that anyway.

The one thing I see that you could get is one day of penalty pay for them not having your paycheck ready on the termination date, CA is pretty strict about that. You could also file for unemployment, you have a reasonable chance of being eligible for that.
posted by magnetsphere at 9:39 AM on December 6, 2012

The performance plan is designed to provide documented grounds for dismissal that make a discrimination lawsuit hard to win. This involves trying to get the employee to agree to the plan in writing, as that makes it far more effective as evidence.

The latter assertion is simply not true, unless it is an extraordinarily bizarre performance plan. Employees are not asked to sign the plan to document that they agree that they agree with the evaluation of their performance, they are asked to sign to document that they received the plan. By and large, refusing to sign them just makes you look like a PITA at trial, to the extent it has any effect at all.

In terms of a potential age discrimination suit, they are notoriously difficult to win (particularly in the aftermath of the Gross decision), however California has some more plaintiff-friendly state laws. As magnetsphere notes, age cases are a difficult sell (although I'd contend that it is not so much concern over fees but rather a reflection of the fact that so few of them are winners).
posted by Lame_username at 12:34 PM on December 6, 2012