Whether you are an employer contemplating how to best terminate employees because of downsizing or an employee asked to sign a severance agreement, leaving a job is stressful. If you value the employees you must terminate, you may want to offer them a severance package to let them know you appreciate what they contributed to your business.
Employers should discuss the sensitive issues that arise when dismissing employees with a North Carolina severance agreements lawyer. Additionally, employees presented with one to sign should contact an experienced attorney to review it and advise them on their rights and responsibilities.
At-will employment means employers can hire and fire employees as they see fit, other than for reasons that violate specific laws under the Equal Employment Opportunity Commission (EEOC). These laws protect certain classes and prevent discrimination based on race, gender, sexual orientation, age, and religious affiliation.
Employers do not have a duty to employees to pay any severance benefits. If they do pay them, it is usually to get employees to release them from any liability they may have incurred during the employment period.
Employers can run afoul of the Retaliatory Employment Discrimination Act if they harass or terminate employees protected under the Occupational Safety and Health Act, the Mine Safety and Health Act, the North Carolina Wage and Hour Act, Workers Compensation Act. There are other legal protections against discrimination in the workplace, which a knowledgeable attorney could further explain.
A severance agreement is an exchange of valuable benefits such as additional pay or continued insurance from the employer for the promise to not sue by the employee. This is true regardless of whether grounds for a lawsuit are present, illusory, or may be raised in the future. A local attorney could provide a client with an all-encompassing severance agreement that is suitable to both parties.
The Older Workers Benefit Protection Act (OWBPA) outlines several mandates for covenants included in severance agreements when employees agree not to sue employers. Because a severance agreement is a contract, both parties to the agreement must give up something meaningful to get something else of value. Some additional mandates include the following:
If an employer neglects to include covenants under the OWBPA, the courts can void the severance agreement and allow former employees to sue and keep any severance payments. A North Carolina attorney could safeguard termination procedures by drafting well-executed severance agreements.
Severance agreements benefit employers who risk retaliation from disgruntled employees after termination. These contracts also help departing employees by providing additional money or extended benefits that are useful while hunting for the next job.
However, employees should retain independent counsel to make sure they know what they are signing. If they have been harassed or discriminated against, a local employment attorney familiar with severance agreements can advise them about waiving their rights or filing a federal complaint.
Termination is never pleasant for employers or employees, but a well-crafted severance agreement can lessen the stress for both parties. Employees gain benefits, monetary and otherwise, and employers can rest easy knowing they will not be sued.
If you are an employer wondering how to handle employee termination or an employee presented with specific benefits tied to termination, consult a North Carolina severance agreement lawyer. Call Sparks Law today to learn how we can help you.