Can Employees Sue for Not Receiving Severance Pay?

Losing a job unexpectedly can be overwhelming, especially when there is no severance pay offered. Many employees are left wondering whether their employer followed the law or whether they were denied compensation they were legally entitled to receive. Our experienced employment lawyer can help review your situation, identify potential violations, and explain what options may be available to you.

Employers do not always clearly explain workers’ rights during layoffs, and some rely on employees not knowing the law. Speaking with an attorney can help ensure that your rights are protected and that you do not walk away from compensation you may be entitled to under federal or California law.

What is Severance Pay?

Severance pay is money that is paid to an employee when their job is terminated. Under the Fair Labor Standards Act (FLSA) there is no requirement that an employer pays a worker severance regardless of whether they are laid off or let go for another reason. 

While severance pay is not required as a matter of federal law, it may be required as a part of your employment contract. In addition, an employer must pay you through the end of your employment as well as for any unused paid time off. It is always in your best interest to consult with an employment lawyer to determine if you have a valid case against your employer.

When You Might Be Entitled to Severance

Employees are sometimes entitled to severance pay under specific circumstances, although the law does not automatically require it. Many employers agree to provide severance through written agreements, company policies, or negotiated employment contracts. Employees may have the right to take legal action when an employer does not honor those promises to pay severance.

Situations where severance may apply include:

• Employment contracts that guarantee severance in the event of layoffs
• Executive or management agreements that include severance provisions
• Company policies or handbooks promising severance during layoffs
• Negotiated severance packages offered during workforce reductions

Can I Sue for Not Getting Severance Pay?

If severance pay was guaranteed as a part of your employment contract, you may be able to bring a lawsuit against your employer. It is important to retain any documentation including your employee handbook, emails, or company memos that discuss severance pay and your rights if you are laid off or terminated from your employment. 

Is It Illegal to Not Give Severance?

Many workers assume that failing to provide severance is automatically illegal, but the reality is that the legality depends on the circumstances. Because severance is generally not required by federal law, an employer does not necessarily violate the law by offering no severance at all.

However, it may become a legal issue when:

• A written contract or company policy promises severance
• An employee is treated differently in a discriminatory way
• Layoffs violate wage and hour laws or retaliation protections

California law may also provide additional employee protections depending on the circumstances of the termination or layoff. This is why it is important to have the situation reviewed by an attorney who understands employment law, how these disputes are handled, and whether an employee is in a position to sue for not receiving severance.

Does My Employer Have to Give Me Notice?

Under the Worker Adjustment and Retraining Notification (WARN) Act, employers with 100 or more employees are required to provide at least 60-days notice to their employees of a plant closing or mass layoff. The federal law is designed to protect workers from a sudden job loss.

Most states also have statutes that offer employees additional protections. For example, California’s WARN Act requires that employers with 75 or more full and part-time employees give a 60-day notice for plant closures, layoffs of 50 or more, and relocation of at least 100 miles.

What to Do if You Were Offered Nothing After a Layoff

If you were offered nothing after losing your job, consider taking the following actions to protect yourself and evaluate whether your employer violated the law:

• Request written confirmation of your termination and final pay
• Collect employment agreements, emails, and company policies
• Do not sign severance or release agreements without legal review
• Speak with an employment lawyer about potential claims

Even when an employer offers no severance, employees may still have claims involving unpaid wages, discrimination, retaliation, or violations of the WARN Act. Our lawyer can review your situation and explain whether you may have grounds for legal action.

Hiring an Experienced Employment Law Attorney

If you were laid off from your employer without notice or without severance pay guaranteed by your employment contract, you might be eligible for compensation. Contact our office at (213) 232-4848 to discuss your case directly with an attorney. 

At LNN, we have over 30 years of experience helping workers get the justice they deserve. All employment law case consultations are provided free of charge and without obligation to retain our services. There are no fees unless we win. Call now to get started.