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SEVERANCE
Employers are not required by law to provide severance pay. The may opt to provide severance. In limited cases, usually involving larger companies, a severance policy that rewards service in the event of a lay-off or downsizing may exist. Such a policy may offer, by way of example, a week or two of pay per year of service in the event the employment relationship is terminated through no fault of the employee.
The employer may condition payment of the severance on the signing of a release. If the employer has not expressly stated in the severance policy that a release is required, however, and the employee is otherwise entitled to the severance, the employer cannot in that case belatedly condition payment on obtaining a release of claims.
In the absence of a stated severance policy, employers may nonetheless offer severance in exchange for a release of claims. In some cases the severance is offered because of an exisitng or anticipated dispute. In other cases, the severance may be offered simply in recognition fo the employee's contributions to the organization. Even in that event, however, it is more likely than not that the employer will condition payment on the signing of a general release, simply as a good business practice.
In any event, severance policies, offers and agreements should be drafted and reviewed by experienced employment counsel.
Orange County California Employment Severance Lawyer
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