Severance Package - employer adding rules ?

Yes our contract has been terminated and our company has notified us that our position with them will be terminated. Now they did state they were going to give us a Severance package which is great, but we would not get a severance package if other contractor company coming in offers us a position. According to them we must take it and if we dont we still would not get our severance package. I'm not sure how they can tell us what we must do or not do as they are releasing us. I would think even if other company picks up some of us that we would still be entitled to the severance package since they are letting us go. Does this seem like a normal practice?

Thank you

2 answers  |  asked Sep 28, 2005 10:40 AM [EST]  |  applies to Texas

Answers (2)

Margaret A. Harris
Depends on How/Why Severance Offered

Because the answer to your question depends on how/why severance was offered, you will need to take whatever documents and information you have to an attorney. A lawyer will need to know the contents of the documents and the specific circumstances you face before an accurate answer can be given. Do you have an individual contract with the company in which you are guaranteed a severance if you lose your job? If so, what does that employment contract say? Is there a severance "plan"? If so, what does that say?

I can tell you generally speaking that the theory behind severance is that this is a way to help the employee who, through no fault of his or her own, is no longer getting a paycheck. It is seen as trying to be "fair" to the employee (although whether it's fair enough is a different, and political, question). So, the theory goes, if the employee rejects another job, then it is now his or her fault that there is no paycheck coming in -- and it does not seem quite as "fair" anymore to pay that person who lost a job.

Do not take my general discussion of the theory as an answer to your question. As I said at first, no lawyer can answer your question without knowing a whole lot more.

posted by Margaret A. Harris  |  Sep 28, 2005 11:52 AM [EST]
Trey Henderson

There is no standard severance arrangement. It varies from plan to plan. In texas, a company is not required to pay a severance unless it is guaranteed in its plan. Some companies will have it in their plan to discourage a takeover. Other times the plan addresses the issue of a takeover and states that you don't get a severance if you are offered a similar position with the new company. I suggest you seek a local attorney to review the plan and answer your questions.

posted by Trey Henderson  |  Sep 28, 2005 10:57 AM [EST]

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