Legal Question in Employment Law in California
Severence Pay
I work for a copmany that employs in excess of 400 employees in California. I anticipate being laid off within the year. Based on my length of service with the comany I anticipate receiving 6-12 months severence. In the past, the company has paid the severence monthly. Is this proper or is the company required to pay the severence at the time of termination?
If the severence is paid over time is it permissable to be excluded from the company provided health insurance and 401K plan?
1 Answer from Attorneys
Re: Severence Pay
There is no legal requirement that an employer provide severance pay. Accordingly, there are no rules and regulations govern this subject, other than the employer's policies. If the employer's policy is that it will pay severance on a periodic basis, employer is entitled to abide by its policies. Sometimes, however, employers offered the employees the option of taking severance and the lump sum or through periodic payments.
An exception would be if somehow the policy could be construed as an "accrued benefit" which you have "earned" through your service, like vacation or PTO time. These benefits be paid at termination.
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