Like most states, New York is an at-will employment state, which means that if your employer can no longer afford to keep you on the payroll or is just in the mood to give employees the boot, your employer has the right to fire you even if you have not made any mistakes at work that would warrant terminating your employment. Sometimes, even if you are employed on an at-will basis, your employer might offer you a separation agreement to sign when they terminate your job due to downsizing or layoffs. Likewise, in employment relationships where the employee has been guaranteed a job until a certain date, the employer might offer a separation agreement when they terminate the employment relationship earlier than they promised to do in the contract. Sometimes a separation agreement is the best-case scenario in difficult economic times, but in other cases, it is a wolf in sheep’s clothing. If your employer has asked you to sign a separation agreement as part of a corporate layoff, contact the New York City separation agreements lawyers at HKM Employment Attorneys LLP.
How is a Separation Agreement Different From an End of Service Bonus in NYC?
When you sign a separation agreement, your employer gives you money, either as a lump sum or in installments, when you stop working for them. Not every amount of money you at the end of your term of employment is severance pay, which is what the money paid to former employees pursuant to separation agreements is called. For example, some employment contracts stipulate that you will receive an amount of money, usually more than a month’s salary, at the end of the term of employment. You receive this end of service pay if both parties abide by the terms of the contract all the way to its expiration. By signing the employment contract when you started your job, you have already done everything you need to do to receive the end of service bonus; all you have to do is perform your contractually obligated job duties.
Another important difference is that, when you receive end of service pay as part of an employment contract, you knew, before you even started the job, when it was going to end, and you planned accordingly. The end of service pay does not need to help you with an unexpected financial hardship. In fact, many employees whose contracts include end of service pay even plan for a major financial goal based on the anticipated bonus; for example, they might apply for a mortgage loan, buy a new car, or make a big payment toward their student loans, for example. A separation agreement, by contrast, accompanies the surprising news that your job will be ending soon. It is meant to help you cope with the financial hardship brought on by the unexpected loss of your job. Likewise, if your employer asks you to sign a separation agreement, you do not get any money unless you sign to accept all the terms of the agreement.
How Much Money Should an Employer Offer You in a New York City Separation Agreement?
A separation agreement is better than your employer simply kicking you out the door and making you go away empty-handed, but it is not exactly a freebie. Each party to the agreement has certain obligations. By signing the separation agreement, your employer promises to pay you the severance package, which may include money and benefits. Likewise, when you sign the agreement, you promise not to sue your employer for wrongful termination of employment.
How much money it is reasonable to offer an employee as severance pay is a matter that is still up for debate, but usually it is the equivalent of several months of your salary, plus health insurance benefits. If almost everyone in your industry is getting laid off from their jobs, you will probably be grateful to have any severance pay, as it will buy you time to look for a new job or even a new line of work. Remember that you are not under any obligation to accept the first severance package your employer owes you, but once you sign, you give up the right to ask for more money. Your employer should not impose short deadlines with regard to the separation agreement and should give you time to review it with a New York City separation agreements lawyer. Your lawyer might advise you not to accept the first offer and may help you negotiate for a better severance package.
Should You Accept the Separation Agreement or Sue?
If you think that your employer is actually firing you for discriminatory reasons or in retaliation after you engaged in a protected activity and is just using corporate downsizing as an excuse, then signing a separation agreement can feel like you are selling your soul at your employer’s request. If you think you have grounds for a wrongful termination lawsuit, you should not accept the separation agreement. If the wrongful termination was an act of discrimination, you should contact the Equal Employment Opportunity Commission (EEOC), the New York Division of Human Rights, or the New York Commission on Human Rights, since these are the agencies that deal with employment discrimination complaints in New York City. The New York City employment discrimination lawyers can help you with your interactions with the EEOC and these other agencies, since the courts will not consider employment discrimination lawsuits until these agencies have investigated the case and approved a lawsuit. Even before you contact the EEOC, you should meet with the New York City separation agreement lawyers at HKM Employment Attorneys LLP to discuss the best legal action to take if you decide not to sign the separation agreement.
Contact HKM Employment Attorneys, LLP About Separation Agreements in New York City
The employment lawyers at HKM Employment Attorneys, LLP can help you decide whether the separation agreement your employer is offering is fair, whether you should ask for more money, or whether you should file a wrongful termination lawsuit. Contact the employment lawyers at HKM Employment Attorneys LLP in New York, New York to set up a consultation.
