Severance Package

gab

Is it illegal or just unethical?

A company is moving and the company has offered all employees who are not moving with the company a severance package except for this 1 manager. It does not seem to be a discrimination based on Title VII, however, the President of the company does not like this individual?

Is the company allowed not to offer this individual the package?

System

The problem is that practically every employee can come up with a half-plausible reason why firing them is illegal: discrimination, retaliation, ad infinitum. Then the company has to prove what the president's motive was, which isn't easy (or cheap).

I don't know whether the severance plan would be covered by ERISA, which could be another problem.

James Sokolowski
Senior Editor
M. Lee Smith Publishers

Down_the_Middle

You don't provide enough information to make an educated statement about illegality. If the affected individual is being treated differently becuz of age, race, etc....., there may be an argument for some type of illegality. This severance plan--------is it a bona-fide ERISA benefit plan,or a discretionary type of plan? How many employees are going to be impacted by the RIF and is it ATB or targeted in certain areas?????

njjel

When a company has offered a severance package to several employees, doesn't that set a precedence for future employees who are laid off?

Theresa Gegen TX

I think the company may be buying itself more trouble than it is worth not to pay this one employee severance. The employee could sue for discrimination or breach of agreement to pay severance (depending on policies). Then your company could be stuck defending a claim in a state in which you no longer have offices or witnesses. This adds more costs and trouble.

Good Luck!