If you’re curious about how long it might take to receive your severance pay, you’re not alone. Many people find themselves suddenly out of work and searching for a new job. You could be concerned about your immediate financial future and all the anxiety that is likely to come from very understandable fear, uncertainty and doubt. Let’s reduce that stress— this article will discuss what you can expect when waiting on severance pay as you transition between jobs.
Before diving deeply into Severance Pay Length, let’s first be clear on what severance pay actually is. Severance pay refers to the funds a company pays its previous employee upon termination, layoff, or any other kind of departure in exchange for a waiver (a release of legal rights). However, it’s a common misconception that all employees in Texas are entitled to receive severance pay. Every company has different rules about severance pay, but there aren’t any laws in Texas that guarantee severance pay or payout of accrued time off, like vacation time or PTO. A lot of companies will pay out vacation time or PTO when a person gets terminated, but that payout might not even be “severance” if you don’t have to give up your right to bring legal action against the company in exchange for the funds.
So how can you tell what your company allows? Your best plan of action is to read your company’s policies about severance, then call in help from the lawyers at Jackson Spencer Law.
Where to Start When Researching
First, refer to your employee handbook and all contracts you signed when you were hired. Review documents you may have signed at any point during your employment, especially if those documents are new versions of your hiring paperwork. Collectively, these can be used as leverage to help your situation. Even if you don’t have any standing to bring additional claims (or don’t want to bring any additional claims), referring to the employee handbook and policies will allow you to gain clarity on your company’s severance pay policy.
There are a lot of different policies a company might enact regarding when you should expect to get your severance pay:
- You might get your severance pay immediately.
- You might get your severance pay within two weeks, and the company might expect you to continue working during those two weeks.
- Your severance pay might be a lump sum or disbursed in separate payments.
- In our article on severance agreement provisions, we also outline that it’s important to secure your severance as a lump sum, rather than installments.
Regardless of what the policy actually dictates, knowing that policy will help you establish expectations.
Next, when considering how long it will take to get severance pay, talk to others who were laid off at the same time. If there’s any difference in your co-workers’ severance agreements and yours, you may want to talk to an attorney about your options and why your agreement looks different.
If you’re over 40 years old, and you were terminated around the same time as other employees as part of a reduction-in-force (RIF) or other planned job elimination affecting more than one employee, look for an Older Workers Benefits Protection Act (“OWBPA”) notice in your severance paperwork. The OWBPA is a mouthful, but that notice is a list of everyone at the company selected for termination versus those who were retained, by their job titles as well as their ages, which can help an attorney determine if you might have standing for an age discrimination claim. The OWBPA also requires notification that you have 21 days to review the severance paperwork and that you have the right to have it reviewed by an attorney. The OWBPA also requires that employees over 40 be allowed to revoke their signature on the severance agreement within seven days of signing. For this reason, your severance pay may not start until after this revocation period ends.
So Your Severance Pay Deadline Has Passed. Now What?
If your employer has failed to fulfill their agreement because they didn’t pay you on time, didn’t pay you the amount that they promised, or didn’t pay you in the method they guaranteed (like a lump sum), you may have standing to bring a claim. If you’re over 40 and your employer didn’t give you an OWBPA Notice (if you were terminated at the same time as others) and didn’t give you 21 days to have your severance agreement reviewed by an attorney, you may also have standing to bring a case under the ADEA. This is where employment attorneys can go to work for you. Regardless of your company’s intentions, regardless if they were trying to save some money by not paying you, regardless of the reason they didn’t give you an OWBPA Notice, or if they tried to pay you but there was a logistics or banking issue, you may have room to negotiate for your severance pay, even by negotiating for more.
Is It Ever Too Soon to Seek Counsel?
The answer is no. It’s never too early to seek counsel once you have a severance offer in your hands. You do not need to wait for two weeks to pass to start the negotiations process, and our attorneys do not recommend waiting. You do not have to wait for your company to do something wrong, either. After you gather all relevant documentation from your files (and ask the company’s HR department for anything you don’t have), get a licensed professional involved who can help you spot issues and traps in your severance offer. An employment attorney can assist you with identifying issues with your agreement and help you expedite the payment process. Even if you don’t think there’s anything wrong with your severance offer, remember that you’re probably waiving your rights against the company when you sign it— so don’t chance it. Get an attorney’s opinion today with our in-depth, one-on-one document review meeting.