The plan can change at any time. There's nothing to stop an employer from changing it or getting rid of it altogether. In most states, employers are required to give employees a copy of any severance plan the employer either has in place or creates after an employee is hired.
Get a copy of your employer's plan and see if you're covered. It may be in your employee handbook If you have any questions, ask your supervisor or human resources department for details.
Other than wage-based severance pay, some employers will include payment for unused vacation time, while others won't. And, some packages may include services to help employees find new jobs, like job placement and resume services.
If you choose salary continuation and get your severance pay over time, like receiving your weekly paycheck, your severance pay will be taxed as regular income.
Talk to a lawyer as soon as possible. Depending on your age and the severance offer, you may have only a few days to accept the severance package. An attorney can help you determine if you have any legal claims against your employer, how much they may be worth if your suit is successful, and how much a suit might cost you in attorney's fees and court costs.
All of this information can help you determine if your employer's offer is fair.
No. There's no legal requirement making it mandatory for employers to provide severance pay or severance packages to employees.
However, almost every employer must pay into a state-run unemployment compensation fund. In most cases, workers who are laid-off or fired for no fault of their own can collect unemployment compensation.
This doesn't happen too often. Most employers will let you take their original offer even after you've made a counter-offer. However, you need to accept your employer's offer within the time specified in the severance package, otherwise you may get nothing.
It depends on the severance package. Some employers may let you keep anything you've been paid under the severance plan if you're re-hired after you've left. Some employers may make you repay all or part of any money you received. Read the severance plan carefully.
At the very least, if you're former employer contacts you after you've left, ask if you'll have to pay back your severance benefits. The answer may make a big impact on your decision to return to work for the employer.
Generally, you have to be given some time to think about the severance package. It can range from a few days to a few weeks. The 21-day (or 45-day) period is included because, most likely, the severance package contains a release in which you promise not to sue your employer in exchange for the severance benefits.
Under a federal age discrimination law, the Older Workers Benefit Protection Act (OWBPA), if you're at least 40 years old, you have to be given 21 days, and sometimes 45 days, to consider the severance package. If you're not given the correct amount of time, your waiver of any age discrimination claim is no good, and you could still sue your employer.
Usually, your employer can't withdraw its offer of severance during the waiting period. And, you don't have to wait the full 21 or 45 days, either. You can accept it any time.
The severance offer probably also includes a 7-day period to change your mind and "revoke" or cancel your acceptance of the severance offer. This is also required by the OWBPA. However, this 7-day period can't be waived by you or the employer. So, you probably won't see any of your severance pay until at least 7 days after you accept the deal. After the 7-day period, the employer knows you can't revoke the deal, and so it's safe to pay you without fear of being sued for discrimination or wrongful termination.