Raises and Bonuses vs. Layoffs

hrmanagerintx

I am trying to find out if there is a law (Texas or Federal) against labeling a layoff "due to lack of sales" when just enough employees were laid off to cover the bonuses and raises given to those left behind (almost to the penny!)? Any information that anyone can provide would be helpful both personally and professionally!

Theresa Gegen TX

Nope. No law against it. In fact, it is not unusual to have a layoff of some employees coupled with a bonus of others, because the employer wants to ensure to retain the other employees (sometimes in layoffs employees will quick, if they think that the ship is sinking).

The issue would be more of a evidentiary problem -- if the employee says "I was fired because of my protected class (race, etc . . .)" and the employer says, "no, it was a lay off due to financial condition", the employer might have some problem proving that. Although, the savings to the employer from reducing headcount ARE greater than the salary costs (the employer also saves from reduced insurance and benefit costs).

Good Luck!