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Rice Law Office Blog

This blog reviews important legal issues including: personal injury, employee compensation, workers compensation, discrimination and wrongful termination.

Top Tips and Answers to Frequently Asked Questions Regarding Layoffs and Severance

Top Tips and Answers to Frequently Asked Questions Regarding Layoffs and Severance

As the end of one year wraps up and a new one approaches, employers and employees alike often find themselves setting new goals for the new year. For employers looking to tighten their belts and increase profit, this sometimes means a decision to reduce or reorganize the workforce.  Some employers try to ease the shock (and reduce their risk of lawsuit) by offering employees a severance package in exchange for a release of all claims. These offers can be just the bridge and employee needs to make it to their next job or a Trojan horse offering a shiny package with very little value.

It can be frightening if you're the one caught in this tide of change, but you're not alone. Take a deep breath and consider getting a consultation with an experienced employment attorney- a few hundred dollars could save you thousands in the long run. Here are a few tips to get you started:

The First thing you need to know: Employees in New Hampshire are not automatically entitled to severance in the event of a reduction in force or layoff. 

That said, where employers establish a severance program voluntarily, it may become a right in accordance with the union collective-bargaining agreement or under ERISA, a federal law governing employee benefits. Therefore, if you've been selected for a layoff, you will want to ask your HR representative if the company offers a severance package.

Second, employers rarely offer severance without asking for something in return. 

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