About Us

What You Should Do If Your Employer Refuses to Pay Severance

Losing your job is devastating, but the situation is more stressful when your employer refuses to pay severance. A severance package can provide relief and security while you look for a new job. But, you can be left in turmoil when your employer fails to honor their commitment to provide severance.

Understanding the intricacies of severance pay and its legal framework are crucial for protecting your interests and ensuring fair treatment. Consulting an employment attorney can help you understand the importance of severance agreements, the potential reasons behind your employer’s refusal, and steps you can take to assert your rights and seek the compensation you deserve.

If Your Employer Refuses to Pay Severance, Is It Legal?

Severance pay is not covered in the Fair Labor Standards Act or state law. Thus, employers are not legally required to offer severance pay. Instead, severance pay rules are based on your employment contract, and the company’s policies and practices.

Suppose you are entitled to severance pay according to the terms of employment in your contract, or by policy or procedure. In that case, it is illegal for your employer to withhold payment.

What Steps Can You Take When You Are Denied a Severance Package?

Review Your Employment Contract and Company Policy

Look for provisions in your employment contract that specify details regarding severance pay. You should review company policies and procedures regarding severance pay if you do not have an employment contract. Your employer may not tell you that your company policy entitles you to severance pay.

Document All Communication

Keep records of your requests for severance pay and your employer’s response. Include document dates, times, and conversation details. Put your request in writing and include your supporting evidence.

Consult an Attorney

An employment attorney can give you a legal assessment of your situation and help review your employment contract and severance policy. The attorney can also evaluate any potential legal claims.

Your attorney can explore your options, such as negotiation and filing a legal claim. The attorney will engage in talks with your employer on your behalf and help advocate for your rights. Not only will the attorney present your case persuasively, but the attorney can also help negotiate a fair severance package. Mediation is usually more amicable than going to court. It can potentially save you time and the stress of engaging in a legal battle.

If mediation isn’t an option or is unsuccessful, an employment lawyer can help you file a lawsuit. The attorney will help gather evidence, prepare legal documents, and represent you in court if your employer is in breach of contract or has violated employment laws.

When Does an Employer Have to Pay Severance?

Although employers aren’t legally required to offer severance pay, there are times when they do need to pay severance.

For example,

  • Your employer is legally bound to honor the terms outlined in your employment contract regarding severance pay.
  • The company must also honor established severance policies for certain circumstances (like layoffs, plant closures, and workforce reduction). In that case, the employer may be liable to pay severance.
  • Under the Worker Adjustment and Retraining Notification Act, employers with a certain number of employees have to provide advanced notice of mass layoffs. If they don’t, they may have to pay money damages.

Take Action if Your Employer Refuses to Pay Severance

Navigating the complexities of employment law can be challenging, particularly when it comes to severance packages. But, you deserve to be protected in an unfair severance pay situation, and consulting an employment attorney can offer that protection and guidance.

At Rowdy Meeks Legal Group LLC, we vigorously pursue employee rights. This includes unpaid overtime cases to reviewing severance packages; we vigorously enforce your wage rights.

So, if your employer refuses to pay severance despite an employment contract or company policy, you should contact us for a free consultation where we can assess your case.