Can taxes be taken out of severance pay?

I was laid off on 10/3/01. My employer said he would give two months' pay and three months' health benefits, and that he would pay me in the next four paycheck cycles. I have asked for this in writing and have not yet received anything from him. He requested all keys from me on 10/3/01, has disconnected my designated phone line, and has taken my name off of the company directory on the website. I have applied for unemployment.
Question: Since I am no longer an employee of the company, can he still take taxes out of my severance pay? If so, how does this affect my application for unemployment?

1 answer  |  asked Oct 10, 2001 06:44 AM [EST]  |  applies to California

Answers (1)

Richard J. Vaznaugh
Severance pay

Unless there is a reason to characterize it differently ( such as compensation for a potential claim allowing recovery for emotional distress damages) your severance pay is probably properly subject to standard wage payment deductions. EDD will be better able to answer your Q re unemployment benefits -- you can call them anonymously if you wish. My understanding is that salary continuation will affect your unemployment whereas a lumpsum payment at the conclusion of work (ussually for back wages/benefits owed or in exchange for a release of liability) will not.

posted by Richard J. Vaznaugh  |  Oct 10, 2001 11:53 AM [EST]

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