Severance Packages

There is no law that requires an employer or organization to offer a severance package to an employee that has been the victim of downsizing. When a company does offer a package, and many do, the company is likely to compute the severance pay package based on a formula.

The formulas used to calculate a severance package include things like the years of service, current pay scale, and too many other factors to list. Packages, in short, vary from company to company as well as from employee to employee. Some companies may allow their employees to negotiate a severance package. When this is done, it is important to consult a lawyer first.

One negative of a severance package is that it may disqualify an individual from taking part in unemployment benefits. This can happen if the severance package payments are equal to or exceed the amount a person was taking home while employed. If this happens, the payments qualify as income and may disqualify a person from unemployment.

When one is laid off, it is important to start the severance package information as soon as possible. The paperwork and process can take a long time and so the sooner it is started, the sooner a little bit of income comes in. Be careful before signing anything though. A severance package may infuse some much-needed cash but it may also require that a person sign away his or her right to sue the company for misdeeds.

Contact a Houston Employment Lawyer

If you are concerned about the potential for a lawsuit against your former employer having already signed a severance package, contact the Houston employment attorneys of the Ross Law Group at 713-482-6910.