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NYC Employment Lawyer > Blog > Wage Violation > Is My Severance Agreement Equitable?

Is My Severance Agreement Equitable?


Severance is a package of pay and/or benefits that is given to an employee upon the conclusion of their employment. While not every employee is entitled to severance, many New York employers do grant it on a voluntary basis, especially to executives or workers with seniority. As of this writing, New York state law does not regulate how or when severance must be granted – but if it is given, it must be equitable and appropriate.

Employers Have Leverage

Because the state of New York does not regulate severance packages beyond requiring that they be equitable, employers have a fair amount of leeway in the method of distribution. For example, while most people receive severance in a lump sum payment, it is not unheard of for some terminated employees to receive what is known as a ‘salary continuation,’ where they simply remain on the employer’s books for a short period until their severance lapses. (This is common in situations where an employer is willing to allow the terminated employee to stay on the company’s health insurance for a while past their termination date.)

Most of the time, an employer will provide a severance agreement for the employee to sign if they accept the proposed package. In general, the employee can wait and think over the offer before they must sign it, though some employers may insist on a quick decision. It is relevant to note that if you are over the age of 40, federal law does require your employer to give you at least 21 days to consider, but workers under that age have no statutory right to a waiting period. Either way, if you believe that you have been wrongfully terminated, or the agreement is inequitable, you should not sign.

Know Your Rights

Even if you are offered a severance package out of your employer’s seemingly voluntary choice, be advised that sometimes, there may be a hidden agenda, particularly if you have been discriminated against or experienced unnecessary negative employment actions. Very often, a severance package will contain a waiver of any claims against the company, in addition to any benefits or pay you may receive. You may simply decide to sign it, but very often, the right legal help can negotiate you a better agreement if you have a potential claim to hold in reverse.

If you are terminated, most New York employers will offer you a severance package, either for positive or negative reasons. However, if you quit or are terminated specifically for misconduct, you will generally not receive severance – the thinking is that you “lost” it due to your choices, and New York law does not require severance to be offered unless one of three situations exists: (1) you have an employment contract that requires it; (2) it is company policy to do so; and/or (3) you are a member of a union with a collective bargaining agreement that mandates it. Your situation may be unclear – but if it is, it is generally recommended to simply file a claim with the Department of Labor and allow them to determine what benefits you may receive.

Contact A New York Employment Lawyer

If you have been terminated from your job, you may be eligible for dismissal or severance pay in addition to any unemployment benefits you receive – but if you believe that your termination was wrongful, it is crucial not to sign. Contacting a New York City frequent wage violation lawyer from Mansell Law, LLC can give you a clear picture of your rights and your options, and ensure that your rights are protected. Call our office today at 646-921-8900 for a free consultation.




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