August 12, 2016

Am I Legally Required to Pay Severance to a Departing Employee?

One question that we get from employers and business owners all the time is “Am I legally required to pay severance?” The general answer is no, but the conversation doesn’t end there. In certain circumstances, an employer may be required to pay severance, such as when the employment agreement or employee handbook provides for the payment of severance to employees upon termination; if the employer indicated during the hiring interview that the company pays severance as an inducement for the employee to join its ranks; or if the employer’s past actions have created a pattern or practice of pa...

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