Are you leaving your current employer? Are you being offered a severance pay package? If you’re in this situation, you’re probably wondering what Illinois severance pay packages are and whether you’re getting a better deal. Since the concept of severance pay is a bit confusing, it’s best to seek the services of an employment attorney to have the aspects regarding it explained.
What Is Severance Pay?
Severance pay, also referred to as a separation payment, is a form of benefit made to employees after termination of employment due to issues that are beyond their control, which includes layoffs, company mergers, takeovers, and plant closings, etc. The agreement is essentially a contract wherein an employee relinquishes his rights to sue or file an administrative complaint in return for additional compensation.
In Illinois, there is no law that requires employers to give severance pay to employees irrespective of why their employment was terminated. While the state does not require employers to pay severance pay packages, it requires them to meet their contractual agreements. For instance, if it is customary for a company to give a severance package to its employees, but a terminated employee is denied the pay based on religion, race, sex, or nationality, he has a right to demand the pay under the discrimination laws of the state of Illinois.
Forms of Illinois Severance Pay Packages
- Money: The amount is usually based on the length of employment, i.e. it could be a week’s or two weeks’ pay for every year of service, or any other amount determined by the employer. The amount can be offered either as a lump sum or it can be spread over a several weeks.
- Health insurance benefits: Some employers opt to continue giving health insurance benefits to employees albeit for a short time.
- Unemployment benefits: Employees being terminated can obtain unemployment benefits if their termination isn’t as a result of serious misconduct.
- Reference letters: Some employers offer terminated employees with reference letters for future employment.
The language pertaining to Illinois severance pay packages can be difficult to understand. An improperly executed contract may be rendered unenforceable by a court of law, and you could be termed guilty of a breach without even knowing it. Therefore, it is prudent to utilize the services of a Chicago HKM employment attorney to get answers, safeguard your rights, and negotiate an equitable severance pay package.