Employee leaving on his own - severance?

britneys

We have an employee that has been with our company well over five years and was in a position where sensitive information was available. This employee is leaving (of his own volition) and unfortunately, the company is experiencing some "gray" areas of employment and SEC laws that the employee knows about. I know the employee is not going to sign the document we have employees leaving sign. I'm thinking about just throwing a big severance package at him and hoping that will entice him to sign the document (standard will not sue, bring action against, etc.). Does his signature make him immune to any legal action he or anyone else in the company might take and want him to participate in? Thank you.

sonny

I may be all wet here and feel free to tell me if I am. .(if you don't someone else will) An employee is leaving on his own, but you want to offer him severance so he will sign papers. .seems like bribery to me?

britneys

But if he doesn't sign them then I'm sure he'll be taking action when he leaves. (its been rumored as much). It may look like bribery but is his signature legal against further action.

Also, what if HE comes in and says he won't sign UNLESS we give him a nice severance package. What recourse do we have at that point? Isn't that extortion?

ray a

"This employee is leaving (of his own volition) and unfortunately, the company is experiencing some "gray" areas of employment and SEC laws that the employee knows about."

This statement makes it sound like the company is doing something illegal or unethical, or at least borderline that someone could perceive as not above board. If so, is that why he is leaving? To get away from a situation he perceives as not right?

Something doesn't sound right here. There has to be something that is motivating him to quit and hold something over your head demanding a severance. It does almost sound like "hush money".

britneys

[font size="1" color="#FF0000"]LAST EDITED ON 03-31-03 AT 03:03PM (CST)[/font][p]Unfortunately the company is doing several things that the SEC and EEOC would find questionable and this employee knows about it. While the company is working of fixing these things its taking time. I don't know for sure why he is leaving but I've heard through the rumor mill that he knows about the "questionable" activity and is leaving partly because of that and partly because he doesn't like his job. I've also heard that he may ask for a severance. If I tell him no and he doesn't sign then he'll take action. If I give him severance and he signs can he take any further action? Also, he'll have some PTO and a few days of work left over which were going to be paid out on the next pay period. Can I withhold that if he doesn't sign?

Moria

>Unfortunately the company is doing several things that the SEC and
>EEOC would find questionable and this employee knows about it. While
>the company is working of fixing these things its taking time.

I agree, it does sound like hush money. I think that you would set a nasty precedent, so when the next person comes in and threatens to quit will you offer them a "severance"? I say if your company is "working on fixing these things its taking time." take your chances, it is going to cost you big no matter what, because even with the severance you have no assurance that he won't blab anyway.

ray a

If you give him severance are you going to have him sign a document stating that he will not act as a "whistleblower"? Do you think that document would hold up in court? I would act under the assumption that he will blow the whistle.

I agree, if your company is doing the right thing by trying to right past wrongs, the best you can do is take your lumps. Do blackmailers ever stop when they get enough or think you have paid your fair share, or do they go as far as they can and get as much as they can?

I also agree giving him a severance sets a very bad precedent.

Theresa Gegen TX

There is nothing wrong with negotiating an exit deal for this employee -- BUT get your attorneys involved before you do so. There are some good reasons why you might want to let this employee make the first overture about severance. If you haven't fired him (and you say he is leaving on his own), I don't see much of an EEOC claim, unless he says he was forced out!! SEC - I don't know about, but I find that dealing with the issues and cleaning up the mess is less expensive in the long run than paying someone off.

Good Luck

njjel

[font size="1" color="#FF0000"]LAST EDITED ON 04-01-03 AT 09:07AM (CST)[/font][p]Does anyone have good language for such a release that we are discussing here? We have to terminate someone due to downsizing and will be offering a severance but wish to have them sign a release as the employee is in a protected category.

Gillian

Unfortunately, business decisions sometimes have to made, even though it may seem like hush money or setting a precedent. The company must weigh the cost of having this individual out there like a bomb ready to go off at the minute of his or her choosing vs. the cost of a severance package which, if structured correctly can protect the company and allow it to continue on the path of fixing whatever the problems are.

britneys

Well, there are several "time bombs" out there now. Unfortunately, I'm the employee and our HR department is in on the illegal activity the company is guilty of. The EEOC laws they are breaking have nothing to do with me. I just know they're taking advantage of employees' ignorance of them. Same with SEC. They are doing things and bullying the employees into signing documents without the employees knowing their full rights if they don't. Other laws have been broken too. I guess I'll just take action after I leave. I won't be the first and goodness knows I won't be the last. Thanks for all the input though. You all know tons more than our HR director. By the way, is it illegal for a person of senior management to date and marry someone of lesser status in the same office? And if that sr. person got another sr. person who has the same job as her but is at a different office fired because she wanted to be able to be near the person of lesser rank so they could date and marry would she be breaking any legal laws? Ethically it is horrendous behavior but legally, can she do that?

Gillian

There is nothing illegal about this activity. Over the years there have been lots of charges of discrimination filed by individuals who thought that they were being discriminated against because of someones relationship with someone else. The case outcomes have been a bit mixed with most of them being ruled that it is not discrimination. It's terrible behavior, though, and it does create potential liabilities.

Pork

BRITTNY: Oh yes they do; it reads like you are in the mittle of a sexual harassing nightmare and are the receipient of a very hostile workplace. Why don't you shut down your computer right now and "BLOW THE WHISLE", "FILE A COMPLAINT WITH THE WAGE AND HOUR, EEOC, SEC" AND LET THE CHIPS FALL WHERE THE MAY! WHAT DO YOU CARE, THE COMPANY HAS ALREADY RUINED YOUR LIFE AND THE LIVES OF OTHERS AT THE PERSONAL EXPENSE OF THE ORGANIZATION AND OTHER EMPLOYEES WITH LESS PERSONAL KNOWLEDGE AND FACTS. YOU ARE PROTECTED AS LONG AS THERE IS TRUTH TO YOUR PERSONAL KNOWLEDGE OF WHY THINGS WERE DONE AND HOW THINGS ARE LEGALLY WRONG! It sounds like the retail company for whom I prostituted my self for 8 years, only to end up on the street with nothing. My friends turned out to be my enemies; the company no longer is in business because the senior leadership did not understand the organization did not belong to them, but they treated the company resources as their own and they should have all gone to jail!

David Nagle VA

While there is nothing improper about negotiating a separation agreement that provides a payment in exchange for certain promises, I agree with another Attorney Editor who has said you need to get counsel involved. It seems clear that there are several delicate issues here, and as useful as this forum may be, getting and using a form release document that you don't really understand is NOT the way to go.

By the way, the question really does not relate to severance. Severance plans are usually established in advance and are covered by ERISA. The questioner here appears to be asking about an individually-negotiated, one-of-a-kind separation agreement.