Understanding Your Rights When You Are Let Go
We are in the midst of experiencing an especially turbulent and unpredictable economic moment throughout the United States. The COVID-19 pandemic has upended most of society, and conventionally reliable industries have now become vulnerable as government-mandated shutdowns and modified operating procedures limit the ability to do business. These factors have forced even the largest and secure companies to consider and enact considerable layoffs, even among employees who are able to continue working during the pandemic.
Learning you are being laid off is frightening in any situation, much less during the age of COVID-19. It is important you take critical steps to protect yourself as you prepare to transition out of your current job. Below, we review what rights you have when being laid off in California, how you should plan to exercise them, red flags to watch out for, and other measures you should consider.
Be Proactive in Seeking Other Employment Opportunities
In many cases, layoffs are not a surprise. Sharp reductions in business are a telltale sign of forthcoming cuts. If you are hourly, you might see a large drop in the number of hours you are assigned. If you are salaried, you will likely be aware of a slowdown in assignments, sales, and general activity. Sometimes, you might hear internal rumblings about potential layoffs from within the company. You could also see rumors reported in trade magazines or other publications.
All of these warning signs signal that you should begin to start planning your next moves. While some prefer to loyalty to their employer, especially if they have enjoyed a healthy working environment and good pay, you ultimately need to be looking out for you in a potential layoff scenario. Begin by updating your resume and privately reach out to your personal network.
You do not want to advertise that you are looking to your employer, but it is reasonable to explore potential opportunities should your current job become untenable. This is especially true if you have been furloughed by your employer.
How Companies Are Required to Navigate Layoff Notices
In situations where only a few employees are being laid off, employers are under no legal obligation to give you a certain amount of notice before a job is terminated. Advance notice is only required for mass layoffs. This can leave employees at smaller companies especially vulnerable to disruption.
Larger employers must give a certain amount of notice for larger layoffs under the California Warn Act. If a work facility is closing, the company must provide at least 60 days’ written notice in advance of 50 or more employees losing their job within a 30-day period. If a facility is not altogether closing but a mass layoff is still occurring, an employer must give 60 days’ written notice before letting go 500 or more employees in a 30-day period. These rules also apply if a company is laying off 50-499 employees in a 30-day period if the number being terminated represents at least 33% of its workforce.
An individual layoff notice can take several forms. Following the company-wide written announcement, you might receive a personal phone call informing you of the job loss, especially if your company cannot conduct in-person business. Otherwise, you may be summoned for a one-on-one, in-person session to discuss the termination. Receiving the notice, no matter how expected or how it is delivered, can result in shellshock, but it is important to try and maintain a level-head and ask important questions relevant to your immediate future.
Understanding Your Layoff Notice
Ask questions about the nature of the layoffs, either in the meeting in which you are privately informed or in follow-up questions to your supervisor and/or HR representative. How was it determined who would be laid off? Is there a reason you were specifically chosen to be let go? What will happen to your job responsibilities? When is the end date for your company-sponsored insurance, and how will other benefits, including company-sponsored retirement contributions, be handled?
Do not feel like you are asking too many questions. You are entitled to these answers and should try to get them in writing wherever possible.
Your layoff notice should include your expected last day of work. If you are already furloughed, chances are the date of your notice will also be your “last day” of employment.
If you are still actively working, there is a chance your end date will be sometime in the future. You might be informed you are expected to work as many as several months before a layoff will take effect. In these situations, you have some flexibility in how you respond. By continuing to work, you will guarantee your current wages and benefits through the set layoff date.
Companies generally institute in these situations where they need an employee to “close out” their roles as the company prepares to shrink. In some unscrupulous cases we will discuss shortly, they may be preparing to replace you with someone they can pay less.
If you receive another offer of employment before your layoff date, do not hesitate to accept it. Your company may be frustrated that you are leaving before the set date, but remember, they were already preparing to let you go. Look out for you.
Ensure Your Employment Agreement Is Honored
When you were hired by your company, there is a good chance you signed some form of employment agreement outlining the relationship between you and your employer. It is wise to carefully review this employment agreement if you receive a layoff notice. Often, a well-negotiated employment agreement – especially if you are a valued asset to the company – will include terms about layoffs must be handled. This can include a certain amount of days’ notice you are required to be given or some level of severance, which we will discuss below.
This is especially true if you are represented by a union. In most cases, a company will have to negotiate directly with your union representatives before instituting layoffs involving union workers. These negotiations may be preceded by an announcement of impending cuts. At that time, you should take time to review the specifics of your union agreement and route any questions to your union representative.
Hold your employer’s feet to the fire in honoring your employment agreement. If they refuse to comply with what you both agreed to in good faith, you will likely need legal assistance from an experienced employment lawyer.
Make Sure You Receive Your Last Paycheck
California laws involving receiving final paychecks are extremely favorable to employees. In most situations, an employer is required to deliver the paycheck to a laid off employee on the date of their termination. The check should include all hours worked plus any overtime and unused vacation days or paid time-off (PTO). Companies are not required to pay out unused sick days unless your employment agreement states otherwise.
In situations where you have a termination date in the future but you find a new job before then, you may choose to voluntarily quit. In these situations, California employers are still required to get you your final paycheck within 72 hours if you give no advance notice. If you do give your employer at least 3 days’ notice of your intent to leave the company early, they must have your paycheck ready for your final day.
Review and Negotiate Your Severance Agreement
If you are a salaried employee who has been with the company for several years, there is a decent chance you will be offered with a severance agreement. Your employment agreement may also require a severance offer in the event you are laid off. A severance agreement involves an employer giving you a lump sum payment in exchange for agreeing to certain terms as you exit the company.
It is essential you exhaustively review the specifics of a severance agreement and negotiate for the most favorable terms possible. Note that California typically allows companies to ratify severance agreements with terms that overwhelmingly benefit the employer over the employee, so long as the terms do not explicitly break the law.
Accepting a severance agreement can preclude you from suing the company on grounds of workplace discrimination or wrongful termination. It will also likely bar you from speaking about any negative experiences you had. That is not to say severance agreements are not worth it: You should just ensure you receive what you are worth. You should also review what employers cannot put in your severance agreement.
A higher-end severance agreement will give you one month’s pay for every year worked at the company. Major executives can often get even more. Smaller severances will only pay out one or two weeks’ pay for each year worked. Always negotiate to see if you can get to the upper end of the severance payment spectrum, especially if your being laid off puts you in a position of financial hardship.
Evaluate Whether Your Layoff Is the Result of Workplace Discrimination or Retaliation
If you have suffered workplace discrimination or other forms of retaliatory behavior in the weeks or months leading up to a layoff notice, it is more than fair to wonder if your being chosen for a layoff could be related. Unscrupulous companies will sometimes leverage layoffs to remove employees they consider “problematic” and could otherwise not easily remove due to potential claims of discrimination, including age discrimination.
A company can be financially justified in instituting layoffs if their business is systemically suffering. However, an employer cannot use layoffs to in effect deliberately target and remove certain protected classes of employees. This is why it is important to ask questions about who is being laid off and why. Take note of the makeup of your peers being laid off and look for patterns.
If a bulk of the terminated employees are people of color or are over the age of 60, for example, unlawful discrimination might be occurring. If you recently stepped forward about workplace discrimination, a suspiciously timed layoff could signal retaliatory behavior and wrongful termination.
Proving unlawful conduct on the part of employers in these situations can be difficult, especially if a mass layoff is occurring as a result of legitimate financial problems. If you suspect wrongful termination or retaliatory behavior may have contributed to a layoff, do not sign any severance agreement that limits your right to file a lawsuit in the future. An experienced employment attorney can evaluate these situations and help determine if you have a case.
Filing for Unemployment
If you have not found a new position by the date of your termination, make careful use of any severance payouts and funds from your final paycheck. If you are laid off without cause, you will become eligible for California’s generous unemployment benefits. Be sure to file your claim as soon as your layoff takes effect. This can help financially support you as you seek new employment opportunities.
Our Team Can Make Sure Your Layoff Is Handled Correctly
The uncertainty of your immediate future is disheartening and overwhelming when experiencing a layoff. It is imperative you ensure that every facet your termination was properly handled in accordance with California law. If you are not given proper notice, your employment agreement is not honored, you fail to receive your final paycheck on-time, your severance agreement includes unlawful elements, or you fear your being laid off is a result of discriminatory or retaliatory behavior, you will need the assistance of qualified legal representation to fight for your rights. Our employment lawyers at Polaris Law Group have over 25 years of experience pursuing justice for our clients. We are intimately familiar with the laws surrounding layoffs in California and will leave no stone unturned in making sure you receive what you are owed and your rights are protected.
If you are struggling with any element of a layoff, do not hesitate to call (888) 796-4010 or contact us online.