Some Things to Know if You're Fired

The main concern facing most individuals about to lose their job is the loss of income. In most cases, an employee's only source of income stemmed from their relationship with their employer, and when this relationship ends, many individuals are at a complete loss about what to do next. As a small form of consolation if you were recently or are about to be fired, there are some avenues to mitigate the financial damage caused by losing your job. The following discusses some of these methods and divulges more information on topics that recently fired employees will probably face.

Accepting and Collecting Severance Pay

Final Paychecks

A fired individual is entitled to receive their final paycheck in a timely manner, which in some states means that exact day. Depending on your state laws, employers have a strict set of laws regarding issuing workers their final paycheck, paying out accrued vacation benefits, and other special considerations.

Severance Payments

Workers are not legally entitled to severance pay, unless otherwise specified as part of some express, written previous agreement with their employer. Likewise, some employee handbooks and other employment precedents create the right for employees to expect severance pay, and in rare cases, a verbally implied promise to pay severance has been upheld in courts. Generally, companies are savvy to these loop holes, and in order to be sure, they eliminate anything from the workplace that may insinuate a worker's guarantee to severance pay. Traditionally, companies will offer their fired or laid off employees not terminated due to misconduct an amount of severance pay. However, an increasing number of caveats to accepting severance pay are beginning to appear in the workplace. Some of the items attached as riders to accepting severance pay these days, includes:

  • Documents signed by employees waiving their right to sue the former company under virtually any federal and applicable state and local laws
  • Non-disclosure or confidentiality agreements signed by an employee
  • Non-compete agreements signed by exiting employees
  • Non-disparagement agreements signed by fired employees

Your Legal Rights to Fringe Benefits

Employees do not possess the legal entitlement to collect fringe benefits from their former employer. In many instances, employers will offer fringe benefits to terminated workers as part of a severance agreement, but are in no way legally required to do so. Employers cannot, discriminate between employees when providing fired workers fringe benefits. To ensure your right to fringe benefits from your previous employer, employees must ascertain the following items:

  • Company materials, memos, or handbooks setting standards for fringe benefits to outgoing employees
  • Past company precedents in offering fringe benefits to former employees with same job as you
  • Documented verbal or written inferential statements implying the payment of fringe benefits for terminated workers

The most commonly discussed fringe benefit offered to recently terminated workers is health insurance coverage. The COBRA laws protect a fired worker's right to receive health care coverage in the same manner as if they were still an employee for up to eighteen months for themselves, their spouse, and their dependents. The former employer is required by law to maintain the administration of these group benefit rates to fired individuals per the COBRA laws.

Outplacement Programs

In order to shield themselves from lawsuits and promote the future of their fired employees, some employers offer outplacement programs as part of the termination process. The theory is that employees placed in other jobs after being terminated will be much less likely to file suit against their former employer, and employers can use the outplacement offerings as a defense against wrongful termination claims. Participation in these programs is voluntary for recently fired workers, but some companies may even offer financial incentives to participate.

Page 2: Making Up for Lost Earnings and Non-Compete Agreements

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