Showing posts sorted by relevance for query at will. Sort by date Show all posts
Showing posts sorted by relevance for query at will. Sort by date Show all posts

Tuesday, September 27, 2011

Employed "At Will": What Does That Mean? Pennsylvania Contingent Fee Lawyers Explain the Most Important Employment Law Principle

Newspaper with Headline "At Will"
You Must Understand the "At Will" Principle to Understand Employment Laws

Employment At Will: The Most Commonly Misunderstood Principle in the Workplace?

Most Americans have a general understanding of the "employment at will" doctrine. They understand that it means that they are not guaranteed employment for any specific period of time. In general, and at least intellectually, they understand that they can be fired at any time, and for any reason.

However, it is our experience that folks do not know what that overriding principle - that one can be fired at any time and for any reason, unless the reason is illegal - truly means and how it plays out in the workplace.

In order to truly understand this principle, it is helpful to examine workers who are not at-will employees.  We will look at the three most common-type employees, from most populous to least.

Union Oil Workers on Strike
If you Work in a Union, You Can Only Be Fired for Cause as Set Forth in the Union Contract and
Are NOT Employed "At Will" 

Unions Were Created to Combat the Employment At-Will Rule


In the United States, it was decided long ago by the courts that employment disputes would not be a matter for litigation in the courts. Thus, until unions came into vogue in the 1940s, employees in general had no protection against being terminated for any reason whatsoever. Indeed, employees had no right to any specific terms and conditions of employment (i.e. vacation and sick days, work conditions, hours of work, etc.).

With unions came Collective Bargaining Agreements, which are contracts between companies and their employees that, among other things, prohibit termination in the absence of progressive discipline and the exhaustion of a grievance and/or hearing process. Perhaps the most critical of the rights union employees have are those established in the 1975 Weingarten case, a summary of which you can find Here.

Thus, if you are member of a union, you generally cannot be terminated unless there is “good cause” for the termination, and unless the company first goes through a progressive set of disciplinary actions.

I'll Go With the Guy With the Cheesy Tie

Many Government Employees Are Not At-Will Employees

Many employees of federal and state governments cannot be fired without cause.  For example, employees of the federal government are protected by the Civil Service Reform Act of 1978 Here is an excerpt from the Act summarizing its purpose:

Civil Service Reform Act - =Title I: Merit System Principles= - Enumerates the principles of the merit system in the Federal work force. Prohibits the taking of personnel actions to discriminate against a Federal employee on the basis of race, color, religion, sex, or national origin, age, handicapping conditions, marital status, or political affiliation. Prohibits, generally, taking or influencing personnel actions for political or other nonmerit reasons and nepotism.

We will not attempt to further unpack the Act here; if you are a federal civil service employee and believe you have rights that are being violated or ignored, best to contact competent counsel at once.

Many states have similar protections for civil service employees. For example Section 807 of the Pennsylvania Civil Service Act of 1941 states:

Section 807. Removal--No regular employe in the classified service shall be removed except for just cause.

Section 951 of the Pennsylvania Act provides that any employee subject to adverse employment action may request and will be granted a hearing:

Section 951. Hearings--(a) Any regular employe in the classified service may, within twenty calendar days of receipt of notice from the appointing authority, appeal in writing to the commission. Any permanent separation, suspension for cause, furlough or demotion on the grounds that such action has been taken in his case in violation of the provisions of this act, upon receipt of such notice of appeal, the commission shall promptly schedule and hold a public hearing. 
The key to bear in mind is that many government employees are entitled to due process before and/or after they are terminated, demoted, passed over for promotion, etc.

Considering these rights, as opposed to those of America's workforce (and likely to yours, dear reader0, really helps to put the "at will" rule in perspective. At will employees simply have no right to secure a hearing to protect their job.  

Why have state and federal governments decided to protect their employees from the at-will doctrine?  The government will tell you that it is a reward for the allegedly low-pay and tedious grind undertaken by government workers.  Tell that to your local waitress or retail clerk!

We choose to believe the government has such protection in place because it understands that the at-will principle is wrong.  After all, the United States is the only country that follows this rule.

In any event, government employees often enjoy stable and predictable careers and many are more likely to die on the job than be fired! 

Rutgers Coach Rice: Throwing Balls at
Players = "Good Cause" for Termination

Employees With Employment Contracts Are Not At-Will Employees

If you are a professional athlete or manager, or a college coach, you are not employed at-will.  Under your contract, you likely can be fired only "for cause."

If you are an executive or senior officer of a company, you may also have a contract that says that you can be fired only for cause.  In such cases, you are not an employee at will.

Some folks believe they have contracts for term because their employment contract says "we will pay you $100,000 during your first year of employment, which will end on XX, 20XX."  However, most such contracts also contain a "nothing in this contract should be read to alter your status as an employee at will," or words to those effect. Unless the agreement says "we guarantee you one year of employment unless you are fired for cause," you are most likely employed at will.

Other things to look at where employment offer letters or contracts are concerned are whether they mention severance.  If no severance is mentioned, you are likely being hired as an at will employee.

NOTE: We help employees negotiate employment agreements to help protect them from the at will doctrine.

Three Teachers, White Woman, Asian Woman and Black Man
Even if Not Part of a Union, Most Public School Employees Have a Right 
to Due Process Before Termination

Public School Teachers and Employees Are Generally Not "At Will" Employees

Wikipedia sums up a public sector employee's rights, frequently referred to as Loudermill rights, in the following passage:

Cleveland Board of Education v. Loudermill, 470 U.S. 532 (1985), was a United States Supreme Court case in which the Court held that:

  • certain public-sector employees can have a property interest in their employment, per Constitutional Due Process. See Board of Regents v. Roth
  • this property right entails a right to "some kind of hearing" before being terminated—a right to oral or written notice of charges against them, an explanation of the employer's evidence, and an opportunity to present their sides of the story.
  • thus, the pretermination hearing should be an initial check against mistaken decisions—not a full evidentiary hearing, but essentially a determination of whether there are reasonable grounds to believe that the charges against the employee are true and support the proposed action.
  • in this case, because the respondents alleged that they had no chance to respond, the District Court erred in dismissing for failure to state a claim.

As a result of the case, public sector employers are required to provide a Loudermill hearing and/or a Loudermill letter before terminating an employee.


Gold and Wood Gavel on Contract
Most Employees Do Not Have Contracts or Due Process Rights
and are Hence Employed "At Will"

So What, Exactly, Does it Mean to be an Employee At-Will?

In sum and substance, it means that you may be fired for any reason at all, without any due process or right to be heard and/or defend yourself.

It means you may be fired if your boss does not like you.

It means you may be fired if your boss wants to promote someone he/she likes better than you into your position, even if you did a better job than your replacement.

It means you may be fired if the company incorrectly believes you did something wrong.

It means you may be fired if a co-worker complains or reports about something you allegedly, but did not actually, do or say, because that co-worker does not like you and was trying to get you in trouble.

It means you may be fired out of spite, or over a petty dispute.

No Protection from Evil Boss Under Employment Laws

It means you can legally be fired in retaliation for complaining that your boss is mean-spirited, rude, unfair and intimidating (but not if you complained that you were being treated unfairly BECAUSE OF your age, sex, race, national origin, religious beliefs or disability).

Collage of Discrimination Words

Do Discrimination Laws Protect "At Will" Employees?

Every rule has its exceptions, and Title VII and its related laws are one big exception, indeed.  Many of the Links below provide additional information on employment laws in the USA.

Family and Medical Leave Act Logo
Even "At Will" Employees Are Protected by FMLA


Does the Family and Medical Leave Act Protect "At Will" Employees?

Absolutely.  Check out some Links below.

Fair Labor Standards Act Book


The FLSA Protects Employees Who Request Overtime Pay

Does the Fair Labor Standards Act Protect "At Will" Employees?

Yes, it does.  If you make a complaint or claim relating to overtime that you believe you are entitled to but not paid and are fired in response thereto, you may have a claim under FLSA. Check out the Link below.

Law Library
The Common Law is in Here

Are There Any "Common Law" Exceptions to the "Employment at Will" Doctrine?  Yes, there Are Judicial Decisions Prohibiting "Wrongful Termination" in Limited Settings

 Common law rules are those principles established not by statute, but by decisions from courts.  Virtually every state has over the past 75 years established limited exceptions to the employment at will principle.  In Pennsylvania, for example, those exceptions are commonly referred to as "wrongful termination exceptions."  

One of the most recent explications of that principle is found in a July 2020 case, Bahnatka v. Victory Brewing Company.  Here is an excerpt:  

With respect to wrongful termination, this Court has previously explained:

"In Pennsylvania, absent a statutory or contractual provision to the contrary, either party may terminate an employment relationship for any or no reason." Weaver v. Harpster, ... 975 A.2d 555, 562 ([Pa.] 2009). "[A]s a general rule, there is no common law cause of action against an employer for termination of an at-will employment relationship." Id. ...
An employee may bring a cause of action for a termination of that relationship only in the most limited circumstances, where the termination implicates a clear mandate of public policy. In our judicial system, the power of the courts to declare pronouncements of public policy is sharply restricted. Rather, it is for the legislature to formulate the public policies of the Commonwealth. The right of a court to declare what is or is not in accord with public policy exists only when a given policy is so obviously for or against public health, safety, morals, or welfare that there is a virtual unanimity of opinion in regard to it. Only in the clearest of cases may a court make public policy the basis of its decision. To determine the public policy of the Commonwealth, we examine the precedent within Pennsylvania, looking to our own Constitution, court decisions, and statutes promulgated by our legislature.
Id. at 563 (quotation and citations omitted).
Applying this standard, Pennsylvania courts have found actionable exceptions where the employee was terminated for filing a claim for worker's compensation benefits, Shick v. Shirey, ... 716 A.2d 1231 ([Pa.] 1998); for filing a claim for unemployment benefits, Highhouse v. Avery Transportation, ... 660 A.2d 1374 ([Pa. Super.] 1995); for failing to submit to a polygraph test where a statute prohibited employers from so requiring, Kroen v. Bedway Security Agency, Inc., ... 633 A.2d 628 ([Pa. Super.] 1993); for complying with a statutory duty to report violations to the Nuclear Regulatory Commission, Field v. Philadelphia Electric Co., ... 565 A.2d 1170 ([Pa. Super.] 1989); and for serving jury duty, Reuther v. Fowler & Williams, Inc., ... 386 A.2d 119 ([Pa. Super.] 1978).
Courts have found no public policy exception where the employee was terminated as a result of sexual discrimination by an employer not covered by the Pennsylvania Human Relations Act, Weaver, supra; for complaining about violations of the Occupational Safety and Health Act, McLaughlin v. Gastrointestinal Specialists, Inc., ... 750 A.2d 283 ([Pa.] 2000); for expressing concerns that the employer's product was unsafe, Geary v. U.S. Steel Corporation, ... 319 A.2d 174 ([Pa.] 1974); for disengaging an illegal surveillance system, Hineline v. Stroudsburg Electric Supply Co., ... 559 A.2d 566 ([Pa. Super.] 1989), appeal denied... 574 A.2d 70 ([Pa.] 1989); or for complaining about the waste of taxpayer money, Rossi v. Pennsylvania State University, ... 489 A.2d 828 ([Pa. Super.] 1985).
In sum, "an employer (1) cannot require an employee to commit a crime, (2) cannot prevent an employee from complying with a statutorily imposed duty, and (3) cannot discharge an employee when [specifically] prohibited from doing so by statute." Donahue v. Federal Exp. Corp., 753 A.2d 238, 244 (Pa. Super. 2000) (quoting Spierling v. First Am. Home Health Servs., Inc., 737 A.2d 1250, 1252 (Pa. Super. 1999)). Outside of those categories of our legislature's expression of public policy, a court may find a public policy exception that will sustain a wrongful termination action only if the public policy "is so obviously for or against public health, safety, morals, or welfare that there is a virtual unanimity of opinion in regard to it." Weaver, 975 A.2d at 563.

Mikhail v. Pa. Org. for Women in Early Recovery, 63 A.3d 313, 316-17 (Pa. Super. 2013).


HERE ARE SOME OTHER ARTICLES YOU MAY FIND WORTHWHILE:

What is an ILLEGAL Hostile Work Environment? Workplace Bullying Alone is Not Illegal in Pennsylvania

#MeToo - The Rules and Deadlines for Sexual Harassment Claims in Pennsylvania - A List of Most Famous Sexual Predators

What is an ILLEGAL Hostile Work Environment? Workplace Bullying Alone is Not Illegal in Pennsylvania

#MeToo - The Rules and Deadlines for Sexual Harassment Claims in Pennsylvania - A List of Most Famous Sexual Predators

Why is it Important to File an EEOC Charge? How to File Discrimination Claims in Pennsylvania? Time Limits to File Discrimination, Hostile Work Environment and Retaliation Charges in Pennsylvania

Employee Complaints and Retaliation - What is Legal and What is Illegal

What Are the Differences Between the Anti-Discrimination in Employment Laws Title VII and the Pennsylvania Human Relations Act?

How Do Federal, State and Local Anti-Discrimination Laws Work Together to Protect Pennsylvania Workers?

Does My Pennsylvania City, County, Township or Borough Have Any Discrimination Laws Protecting Employees?

FILING A CHARGE OF DISCRIMINATION IN PENNSYLVANIA - A FEW TIPS FROM CONTINGENT FEE LAWYERS

The Philadelphia Fair Practices Ordinance Makes it Illegal to Engage in Workplace Discrimination Because of Sexual Identity, Sexual Preference, Status as Domestic Abuse Victim, Marital or Familial Status, Ethnicity or Ancestry

United States Employment and Discrimination Laws - An Overview by Pennsylvania Employment Lawyer

Do I Have a Case for Constructive Discharge? Nearly 50% of People Who Are Unemployed Quit Their Job - Pennsylvania Contingent Fee Employment Lawyers

Comparing Pennsylvania's State Overtime Law, the Minimum Wage Act, with its Federal Counterpart, the Fair Labor Standards Act - Pennsylvania Wage and Hour Lawyers 

What Are My Employer's Obligations When I Request FMLA Leave?  Pennsylvania FMLA Attorneys


Can I Get My Job Back if I Win My Unemployment Hearing?

Pennsylvania Department of Labor Badge
Often Sole Remedy for Workers
Who Are Wrongfully Terminated

If you are wrongfully fired because someone lied about something you did (not do), or because the boss disliked you, or because of petty politics, or because you the company believes that you did something wrong and you did not, then your remedy is to win your right to unemployment compensation benefits.

That is why unemployment benefits exist; to provide some cushion for at-will employees who are fired through no fault of their own.

Click to read:  Pennsylvania Unemployment Lawyers - Willful Misconduct Referee Hearings

However, even if you prove your complete and utter innocence at that Hearing, the company will not be required to rehire you because you were employed at-will.  End story.

Old Time Gold Watch
A Vestige of the Past Even for Faithful Employees

Gold Watches Are a Thing of the Past

For many years, there was an unwritten contract between American companies and their employees. This contract said that if you came to work every day, did a good job, were productive, respectful and loyal to the company, then the company in turn would be loyal to you and would not terminate you unless there was good reason to do so. Generations of American workers came to rely upon this unwritten principle, and many a long-time employee received a "gold watch" for his years of service (rarely for "her" years of service.....).

Those days are long gone.  Nowadays, the only protection employees have are found in union contracts, the rare employment contract for a specified term, civil service laws, state and federal anti-discrimination statutes and a tapestry of wrongful termination laws found in most states.

Money in Envelope Reading Severance in Bold Red
Consider Yourself Lucky if You have a Contract or Company Policy Providing for Severance

Does it Matter if I am an Employee At Will When it Comes to Severance?

Click Here to read our comprehensive Post on Severance, and how negotiating same may be largely dependent upon whether you are an employee at will, versus an employee with a right to severance pursuant to a contract.

Boss With Megaphone Yelling at Despondent Workers
If your Boss is a Bully, You Have Limited if Any Recourse (Except to Seek a new Job!)

Workplace Bullying is Not Illegal - There is no Law Requiring Employees to be Treated Fairly or Decently at Work

Many courts are fond of saying that there is no “civility code” governing the workplace. We supplement that by telling callers that there are no "civil police" in the United States. If a person is being subjected to mistreatment in the workplace, there are no "civil police" who will come to stop it. There is no 911 to call, and HR is more beholden to your boss than they are to you!

So, unless the mistreatment is because of illegal motivations (i.e. discrimination based upon sex, race, age, etc.), the best one can do when being subject to unfair treatment at work is to try and work things out.  This is the very essence of the employment at-will principle.

Pennsylvania Employee Rights Contingent Fee Attorneys
610-647-5027


Philadelphia Are Employment Attorneys Representing Employees

We are employment lawyers who represents employees in Pennsylvania. 

We typically represent employees who need an employment lawyer in Philadelphia County, Chester County, Delaware County, Bucks County, Berks County, Lancaster County and Montgomery County.

Pennsylvania Employment Attorneys Provides Free Telephone Consultations

If you are looking for an employment lawyer, and live in Malvern, Wayne, King of Prussia, Downingtown, Glenside, Doylestown, Radnor, Newtown Square, Exton, Philadelphia, West Chester, Skippack, Langhorne, Haverford, Nether Providence, Broomall, Drexel Hill, Reading or any of their surrounding towns, feel free to send us an e-mail via our Contact Form or give us a call at 610-647-5027.  We are always happy to spend some time with people via a free telephone consultation.

Need an Employment Labor Lawyer Near Philadelphia?

Thanks for checking in with us.

610-647-5027

Tuesday, January 11, 2011

What Does It Mean To Be Employed "At Will" In Pennsylvania?

Most of us are employed "at will" in Pennsylvania (and, as I understand it, in every state in America except California).

There are basically only 2 exceptions to this rule: 1) you are part of a Union (in which case you can only be fired in accordance with the terms of the Collective Bargaining Agreement, which usually provide for "progressive discipline"), or 2) if you have a contract providing that you will be employed for a period of years unless you engage in "for cause" conduct that will result in your termination [(the most common example of this is found in professinal sports - if you have ever heard about a team still paying a player or manager who it terminated last year, that is because the player/manager had a contract for a period of years and was terminated for "poor performance" as opposed to because he/she engaged in "for cause" conduct].

Employment At Will - Defined

If you are employed at will, you can be fired for any reason: a good reason (you did not show up for work for 3 days, you embezzled money, you were late 15 times in a month, etc.), a bad reason (someone said something about you that was untrue and the company believed it, the boss is a jerk and does not like you, the boss likes someone more than you, you are incorrectly perceived as incompetent, etc.) or no reason at all (economic layoff, shut down of a department).

People generally understand that they can be fired for a "good reason", or no reason at all - it is getting fired for a "bad reason" that perplexes and angers us (and for good reason!).

The Exceptions to the Employment At Will Doctrine

There are exceptions to the "at will" principle in Pennsylvania (and throughout the United States) - the doctrine of wrongful termination (the attached Article gives a nice overview of the wrongful termination principle in Pennsylvania - if you fit into any of these categories, you should consult with counsel), unlawful discrimination or retaliation, violation of the FMLA or FLSA, etc.  It is those exceptions that lead to litigation - it is those exceptions that we litigate every day in our office.

Otherwise, the battle about whether your termination was justified is waged in the unemployment compensation department, where the issue is whether the company can prove that you did, in fact, engage in the willful misconduct that was the bad reason for which you were (allegedly) terminated.  Our experience in unemployment hearings is that an employer very often cannot actually prove you did anything wrong. 

The at will doctrine is among the most difficult to understand because we all believe (and justifiably) that we are entitled to be treated fairly if we are dedicated employees.  However, sadly, that is not the truth for most of us at will employees in Pennsylvania (or throughout the Country).

Monday, June 15, 2015

Negotiating an Employment Contract When Relocating to Pennsylvania or Quitting One Job to Take Another - Philadelphia Area Lawyers Who Help Negotiate Employment Contracts

CALL TODAY AND WE CAN DISCUSS YOUR SITUATION AT NO CHARGE
610-647-5027

I Have a Job Offer That Would Require Me to Move to Pennsylvania or to Quit My Present Job- 
Am I Protected Under Pennsylvania Employment Laws?

In Pennsylvania, all workers are considered employed at will unless they are part of a union, employed by the government or protected from termination by a contract.

CHECK OUT THESE ARTICLES :


FILING A CHARGE OF DISCRIMINATION IN PENNSYLVANIA - A FEW TIPS FROM CONTINGENT FEE LAWYERS

So, unless you are a union worker, government employee or party to a written employment contract, the "at will" doctrine protects employers from lawsuits arising from terminations that are unfair, based upon a mistaken belief in a set of facts wrongfully implicating the terminated employee or firings resulting from intentional actions by a co-worker or supervisor designed to bring about the your termination.  

NOTE 1:  In Pennsylvania, there are some limited exceptions to the "at will" principle.  The most common exceptions are contained within anti-discrimination statutes such as Title VII, the Americans With Disabilities, Act and the Age Discrimination in Employment Act, etc.   

In addition to the anti-discrimination statutes, there are some other laws that make it illegal to fire employees who have asserted their rights thereunder.  The most common of these laws are the Family and Medical Leave Act, the Fair Labor Standards Act (requiring the payment of minimum wage, overtime, etc.) and the Pennsylvania Workers' Compensation Act.


Relocating to Take a New Job Exciting -
but Risky Without a Good, Solid Contract

The "employment at will" principle applies if you take a job down the street, or if you move from Alaska to Pennsylvania to take a job.  It applies even if, 3 months after moving to Pennsylvania from Hawaii with your entire family (after you spouse quit his/her job and you took the kids out of school), you are fired because the company misapprehended its needs when it hired you, or because the boss does not care for your approach, or because a customer that had agreed to use your new employer's services backed out of its promise.

And, imagine that scenario if when you started at the new job you signed a non-compete?!?!

NOTE 2:  As I hope is apparent, "at will" employees rarely have a case for "wrongful termination." However,  recognizing that the "at will" principle can result in harsh outcomes, Pennsylvania does provide some remedy to "wrongfully" terminated employees.  This remedy is unemployment benefits

If You Intend to Move to Pennsylvania to Take a New Job, or Wish to Quit Your Current Job to Take a More Attractive One, You Should Protect Yourself With a Written Contract/Employment Agreement

The Chippah and the Boss -
Parties to a Contract
Chip Has Substantial Protection, Do You?

In 2013, Chip Kelly decided to leave his job as head coach of the Oregon Ducks in order to relocate to Pennsylvania to become the head coach of of the Philadelphia Eagles. Coach Kelly was beloved in Oregon, where he probably had a "job for life."  Moving to Philadelphia was risky on a number of levels, not the least of which was that he had never coached in the NFL.


It means that the Eagles were required to pay him roughly $6.5 million for each of the 5 years covered by the contract.  Likely the Eagles also threw in some relocation expenses, as well!

Yet, while relocation expenses are important to the average person, the real key to Kelly's contract was the fact that is was "a 5-year contract."  What that basically means is that the Eagles obligated themselves to pay Kelly the full $32.5 million over the 5-year contract period - whether they kept him employed for those 5-years or not.

While we would all like that kind of job security (and income!), obtaining some degree of job security rises to a nearly essential level for relocating or "job switching" workers. That is so because, in the absence of a written contract, the "at will" doctrine overrides any and all inequities that typically arise when a recently transplanted employee is terminated shortly after uprooting his/her life based upon a set of verbal promises made by the prospective employer during negotiating, none of which are included within an enforceable written agreement.

If the Offer Letter Does Not Contain
Important Promises Made to You,
You Should be Concerned

NOTE 3:  Many job offers extended to relocating or job switching candidates are set forth in a letter, commonly signed by an HR representative (rather than by the person with whom the employee actually negotiated).  While most companies "puff" when negotiating (i.e. make attractive promises), written job offer letters are typically form letters that do not include the "promises" made by the person that actually solicited your employment.  Almost all of these letters state that you are to be "employed at will."  If you are alarmed because the offer letter fails to include important promises made to you by the person with whom you actually negotiated the offer, you have good reason.  That is so because the terms in the letter, and not the verbal promises, will control the situation if you are subsequently terminated.

Protect Yourself by Negotiating an Employment Agreement That Provides That You Cannot be Fired Except for "Good Cause"

Now, few have ever seen Chip Kelly's contract, experienced employment attorneys have negotiated many like it (although few of such magnitude!) and it is certain that there are exceptions to the Eagles' promise to employ and pay Coach Kelly for the full 5 year period.

The most common clauses that enable an employer to terminate a contract short of its expiration date are commonly referred to as "for cause" covenants.  A "for cause" provision in an employment agreement that extends over a period of years is one that spells out (the more specifically, the better) "bad" behavior that would permit the employer to terminate the employee without further obligation.  
Bad Deeds = "Cause"

Common "for cause" reasons for termination typically include being convicted of a felony, engaging in gross misconduct/negligence and overt refusal to honor material obligations required under the contract.

An Employment Contract for a Period of Years Will Often Include a Severance or "Buy Out" Provision

In addition to including termination provisions covering "bad" conduct by an employee, the typical "fair" employment contract recognizes that the relationship may not work out despite good faith by all involved parties, and provides a reasonable exit strategy.  In this way, it is much like a prenuptial agreement.

If you are leaving a secure job to take a new one, you want a severance provision in the new contract!

Spell Out an Exit Strategy in a
Clear, Fairly Negotiated Employment Contract

So, if during the first 3 years of the contract, Coach Kelly tries really hard, but the Eagles lose every game each year, the Eagles will be permitted to end the contract, provided that they provide proper "notice," and "buy out" some or all of the balance of the contract.  For the average worker, the "buy out" would at a minimum include payment of severance and medical benefits for a predetermined period of time (good luck getting an agreement that would pay you out your full salary for the balance of the contract, which Coach Kelly likely has).

Misrepresentation Cases for Relocating or Job Switching Employees Rarely Succeed Under Pennsylvania Law

When people call to inquire about whether they can sue because they were induced to quit one job to take another (and/or to relocate) only to be fired soon after, they frequently assert that the company misrepresented itself during the negotiations.  That will not help under Pennsylvania law, since the "employment at will" doctrine supersedes such arguments in all but the rarest cases.

That is why, the best, safest approach when considering quitting one job to take another, or to relocate to Pennsylvania to take a new job, is to negotiate a written agreement that spells out the parties' respective rights, duties and obligations. And make sure it includes severance if you are terminated without cause!

Protect Yourself, and Test the Good Faith
of Your Potential New Employer

If you are concerned that trying to negotiate a fair deal will be viewed as unduly aggressive or paranoid, and will thus cost you the job offer, you may want to ask yourself one basic question: Am I willing to trust these people under these circumstances?  If you are, then take the job with eyes wide open.  But, perhaps, you may conclude that a company that will not negotiate a fair employment arrangement with you is not worthy of your trust.  

In this connection, by the way, our experience has been that good companies that want to hire attractive candidates are always willing to engage in negotiations that culminate in the inclusion of reasonable covenants that protect the individual from termination for reasons other than "cause."

HERE ARE SOME OTHER ARTICLES YOU MAY FIND WORTHWHILE:

What is an ILLEGAL Hostile Work Environment? Workplace Bullying Alone is Not Illegal in Pennsylvania

Why is it Important to File an EEOC Charge? How to File Discrimination Claims in Pennsylvania? Time Limits to File Discrimination, Hostile Work Environment and Retaliation Charges in Pennsylvania

Employee Complaints and Retaliation - What is Legal and What is Illegal

How Do Federal, State and Local Anti-Discrimination Laws Work Together to Protect Pennsylvania Workers?

Does My Pennsylvania City, County, Township or Borough Have Any Discrimination Laws Protecting Employees?

Do I Have a Case for Constructive Discharge? Nearly 50% of People Who Are Unemployed Quit Their Job - Pennsylvania Contingent Fee Employment Lawyers

Voluntary Severance Offers - How to Negotiate and What to Look for When a Company Offers Severance

Secrets to Severance Negotiations in Pennsylvania Revealed:  Philadelphia Employment Lawyers' Guide to Severance Laws and Strategies


Philadelphia Area Employment Attorney Representing Employees

We typically represent employees who need an employment lawyer in Philadelphia County, Chester County, Delaware County, Bucks County, Berks County, Lancaster County and Montgomery County.

Pennsylvania Employment Attorneys Provides Free Telephone Consultations

If you are looking for an employment lawyer, and live or work in Ambler, Ardmore, Ft. Washington, Bensalem, Downingtown, Media, Chester Springs, Springfield, Malvern, Wayne, King of Prussia, Lower Gwynedd, Glenside, Doylestown, Radnor, Newtown Square, Exton, Philadelphia, West Chester, Skippack, Langhorne, Lansdale, Flourtown, Haverford, Nether Providence, Broomall, Drexel Hill, Reading or any of their surrounding towns, feel free to send us an e-mail via our Contact Form or give us a call at 610-647-5027.  We are always glad to spend some time with people via a free telephone consultation.

610-647-5027



Need an Employment Labor Lawyer Near Philadelphia to Help Negotiate an Employment Contract?

Thanks for checking in with us today!

  




Thursday, February 26, 2015

Voluntary Severance Offers - How to Negotiate and What to Look for When a Company Offers Severance

Philadelphia Area Severance Lawyers Representing Only Employees


Questions?  We will spend 5-10 minutes with you discussing your current work situation, your disability/FMLA leave, your non-compete agreement, your wage claim, your unemployment claim or your potential lawsuit at no charge to you.  Call 610-647-5027.  Or, e-Mail us via the Contact Form.  We will respond promptly.

NOTE:  This Article was initially posted in one piece. Realizing it was far too long, we broke it into 2 pieces.

This part discusses what we refer to as "Voluntary" severance offers.  Click Here to jump to the second part, which discusses what we refer to as "Mandatory" severance offers.

Understanding and Negotiating Severance - Key Things to Bear in Mind Concerning Your Rights When Offered Severance

In general, there are two types of severance packages: Those that are required under the law, a contract or a company policy, and those that are made voluntarily for any one of a number of reasons.

Is Your Severance a Product of Good Will or Legal Obligation?

When considering a severance package that has been offered to you, the first thing you need to do is
determine whether the offer was voluntary or mandatory.  Once you have that figured out, there are multitude of considerations that must be weighed in the course of deciding whether to accept, reject and/or attempt to negotiate the severance package offered to you.

This Post, while certainly not exhaustive, addresses the most common scenarios, approaches and considerations that I have learned about mandatory severance since I started practicing law in 1991.

Do You Have a Question About Severance and Pennsylvania Unemployment Work Together? Click Here.

Why it is Important to Understand the Employment "At-Will" Principle When Considering a Severance Offer

Most Americans are employed "at-will."  That means they have no right to any sort of "due process" in connection with any decision made by the company to terminate their employment.  If you are "at will," your severance offer is most likely voluntary.

VOLUNTARY SEVERANCE OFFERS - THE "AT-WILL" EMPLOYEE

I am an At-Will Employee Being Offered Severance Provided I Agree to Release the Company From Any Claims I May Have Against it for Discrimination, Unpaid Compensation, etc.

Voluntary severance offers made to at-will employees are very, very
 common.

Why, you ask?

Companies Want Finality -
Which a Release Secures
When a company wants to part ways with an employee, it usually wants to make sure that the relationship is severed once and for all.  The best way to achieve that objective is to have the employee sign a Release.  The best way to entice an employee to sign a Release is to offer severance.

Many employees are, understandably, suspicious when such a severance offer is made.  "Why," they ask, "would the company want me to sign a Release, unless it has done something illegal?"

Is it sometimes the case that employers offer at-will employees severance in order to get a Release because the employer believes it is at significant risk for being suing for wrongful discharge, or breach of obligation to pay compensation, overtime, etc.??  Yes,  it is.

Is that usually the case?  No,  it is likely NOT often the case!

Many companies make it their standard practice to offer severance to employees who have been with the company for more than a few years.  There are at least two good reasons for this that spring immediately to mind.

One, such severance offers often reflect the employer's desire to extend good will towards its employees, even those who the company feels are no longer suitable for continued employment.

Two, employers want to know that a former employee will not come back to haunt them in the future.

In this regard, severance offers attached to a Release simply reflect common human experience.  "Hell hath no fury like a woman scorned."

And, maybe, like a fired employee.

So, even though the company does not believe it did anything wrong by firing the employee, it understands that the former employee may not share its view, or may be driven by anger to find a lawyer to sue the company for a variety of reasons.  Hence, offering severance in exchange for the peace of mind engendered by an executed Release simply makes good business sense.

Should I Sue or Sign a Release in Order to Receive Severance?

Where severance negotiations are concerned, this is an area where a qualified attorney can make all of the difference.

That is so because while, in general, the offer of severance and Release signifies nothing nefarious, that is not always the case. Sometimes, rather nefarious doings are, indeed, afoot.

We have seen many situations where an employee's termination appeared to be unlawful.  Indeed, our entire practice is centered upon employee rights, and it is a complex field indeed.  So, while there are many, many people who call lawyers because they are upset after having been fired, there exists only a small percentage of lawyers who actually represent employees on a full-time basis.  It is a very taxing area of practice because employee-side lawyers are often fighting large companies with unlimited resources and a cadre of high quality lawyers.

The problem, though, is that many lawyers who receive calls from disgruntled individuals who have recently been fired give "free advice" over the phone that leads the client astray.  This leads to workers accepting severance offers when they should not have done so, and to workers rejecting severance offers that they should have accepted.


Knowing What is Illegal Discrimination is
Often Key to Deciding
Whether to Accept Offered Severance

The fact of the matter is, illegal terminations exist in a relatively small percentage of situations involving employee terminations.  But, where they do exist, an employee may be entitled to substantial compensation.  So, when we are asked whether a severance offer should be accepted or rejected, it is our duty to fully assess the facts, and to then explain how the law works under the facts presented.

Having been duly informed, it is then up to the client to decide whether to accept the offer as is, or to attempt renegotiation.  If renegotiation is appropriate, it is then up to us to do the best job we can via creation of legal leverage that, it is hoped, will cause the employer to consider our client's legal rights and position, with the result being a more generous severance offer.

Litmus Test for Employment Lawyers:  Would I Sue on Contingent Fee Basis if Severance Negotiations Fail to Achieve my Client's Goals?

Ultimately, it is the client's decision whether to accept or reject the company's final settlement offer.

In close cases, we utilize one very useful tool to assist the client in evaluating his/her position.

Contingent Fee Agreements
High Risk Undertakings
That tool is our willingness to file suit on a contingent fee basis for whatever claim is being contemplated if severance negotiations fail to achieve a desired result.

We are a fairly aggressive lawyers who knows employment laws.  We like contingent fee cases when they work out well because we can make a fair amount of money.

However, when they do not work out well, contingent fee cases can be real back breakers.  Financial, emotional and psychological back breakers.

Of course, the converse proposition is true as well.  If we are interested in pursuing the case on a contingent fee basis, the client has more and better options.

"Will you, sir, take this case on a contingent fee basis?"

The contingent fee question is so critical that, on balance, if you have an attorney assisting you in the
negotiation of severance, the most critical inquiry, at the end of the day, is this one: "If I reject this final offer, will you file suit for me on a contingent fee basis?"

If you have a qualified attorney, his/her answer to that question may be as important as any other consideration you weigh in the course of reaching your final determination.

Philadelphia Area Employment Attorney Helping Employees With Severance Negotiations

We typically represents employees who need an employment lawyer in Philadelphia County, Chester County, Delaware County, Bucks County, Berks County, Lancaster County and Montgomery County.

Pennsylvania Employment Attorney Provides Free Telephone Consultations About Severance

If you are looking for an employment lawyer, and live in Malvern, Wayne, King of Prussia, Downingtown, Glenside, Doylestown, Radnor, Newtown Square, Exton, Philadelphia, West Chester, Skippack, Langhorne, Haverford, Nether Providence, Broomall, Drexel Hill, Reading or any of their surrounding towns, feel free to send us an e-mail via our Contact Form or give us a call at 610-647-5027.  We are always glad to spend some time with people via a free telephone consultation.

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