Layoff Laws: What's Against the Law?


If your company is shutting down and you are leaving a job due to lay-off's, do you know what's against the law? Many companies have unfortunately had to resort to reducing or eliminating the workforce in challenging economic times. That means thousands of people out of work due to lay-off's. There are laws to protect workers from getting laid-off illegally in the United States. Here's what you need to know about lay-off's and what's against the law in your region.

Employment in the United States Is At-Will

For many employees, getting laid off can seem like a personal insult. However, what many do not realize is that in the US, you can either quit or be let go from a job without cause at anytime. This is called "At-will employment" and it's legal according to federal and state laws in the United States. When a company must let employees go, they can do so without any reason given. However, companies must follow employment laws regarding discrimination, whistle blowing and advance layoff notices. You cannot be laid-off just because your boss doesn't like you.

You Cannot Be Laid-off Based on a Protected Status

All employees are protected under anti-discriminatory laws in the US and other countries. That means, you cannot be let go based on age, gender, religious preference, reproductive status or race. However, if you are the oldest and highest paid associate in your division, you can be laid off purely for economic reasons, so long as other high ranking associates are also let go for the same financial reasons. If you fall under one of the protected statuses above, it's advisable to consult with an employment lawyer to make sure your rights have not been violated as a result of a lay-off.

Required Notification for Mass Lay-Off's

When a company must lay-off a majority of its workforce, there are laws in place to protect workers. In the case of a mass lay-off situation, employers with 100 or more employees must notify employees at least 60 days under the American "Worker Adjustment and Retraining Notification" laws. Failure to do so can result in legal suits for loss of income and other damages incurred by employees. In addition to notifying employees, older workers over the age of 40 and pregnant workers must be given an additional week to decide on a severance package.

Severance Pay Not Required, But Benefits Are

In most industries, a standard one to two week severance pay is provided to employees following the lay-off event. In addition, any accrued vacation, personal and sick leave is paid with the final check. Employers sometimes decide not to pay the severance pay stating they have no money, however companies must by law pay the paid time off accrual and cannot withhold final wages. In addition, employers must provide COBRA benefits notification within two weeks of the termination of employment which provides additional benefits coverage for up to eighteen months. In addition, employees have the right to ask for a termination letter verifying a lay-off status that guarantees them financial coverage under state unemployment programs.

Tess C Taylor


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