Severance Packages Subject to Change in The Next Few Years | Mann & Elias
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Severance Packages Subject to Change in The Next Few Years

What Employees Should Know About Severance Post-Pandemic

Severance agreements are reassuring for employees when things go awry at a company. Even those without a deal outlined in their employment contract might still be entitled to this benefit.

According to Randstad RiseSmart, the number of employers extending severance packages rose to 64% this year. That’s a 20% increase from 2019. Though it’s a drastic improvement, severance pay might not be as accessible in the years ahead.

Many companies still haven’t recovered from the economic toll of the pandemic. They are struggling with cash flow and trying to keep up with business. As employers compensate more of their staff, they simply can’t match the demand.

Our labor attorney for employees would urge you to watch these trends closely. Because severance options are expected to change post-pandemic, you need to know how to hold an employer accountable should they breach your contract, wrongfully terminate your employment, or withhold wages you deserve.

Will COVID Affect My Severance Package?

Some find COVID has made the option of severance pay more accessible. It is generally offered to full-time workers that get let go. But more companies have been investing in their workplace by extending this benefit to contract, gig workers, and others impacted by the pandemic.

No laws in California state employers are required to provide final pay. But you might notice a clause or two within:

  • An employment agreement within the termination clause
  • The company policy within a handbook or online
  • A bargaining agreement might promise severance.
  • Federal anti-discrimination laws might also encourage employers to offer severance in an attempt to avoid disparate treatment claims.

Keeping your job is a priority during such an unpredictable period. But be mindful of redeployment. Redeployment is a management strategy companies have executed to move talent to expanding areas within the business. Instead of losing your job and getting a severance package because of the pandemic, you might receive a different position instead.

If you are considering walking away from the company instead of falling victim to redeployment tactics, we urge you to consult with an attorney for severance pay compensation first. It’s hard to differentiate if the company has your best interests in mind.

How Will COVID Change My Severance Pay?

The pandemic has lasted longer than any of us imagined. If it continues, U.S. employers might not want to continue paying severance. With the financial damages shaped by the pandemic, businesses are just not making the same.

Companies are likely to adjust their policy. If you’ve been contractually promised payment, even the amount you receive is subject to change. There are no minimums for severance, but there is a formula to determine how much you deserve. Typically, it amounts to one week of your regular pay multiplied by how many years you’ve contributed to a company.

Unfortunately, other employers just choose a monetary amount they feel is fair. Should you think the firing was unexpected and the rate beneath your standards, an attorney can help you determine hints of discrimination and unfairness.

The New COVID-19 Vaccine Requirement

Most recently, there has been a new requirement for proof of vaccination or negative COVID-19 tests. As companies implement new federal guidelines and policies, employees face termination at higher rates for violating the mandate.

Benefits are based on an employer’s terms and conditions. So, severance agreements should clarify if violating vaccine obligations or COVID-19 testing is considered a “cause” for losing severance pay eligibility.

Never accept a denial for compensation before asking yourself if the COVID-19 policies were clear within your company. Chances are it might not be. Employers will attempt to evade the need to follow through with their promises. Always reach out to our law firm for legal advice and guidance should you have concerns.

About Mann & Elias 

The Law Offices of Mann & Elias is an employment law firm that provides guidance and legal support for individuals facing issues in the workplace. We represent clients at every level of the state and federal court systems. While there are thousands of lawyers to choose from, we strongly believe our success is based on:

  • 50+ years of trial experience
  • 50+ years of trial experience
  • Excellent advocacy skills
  • Intense preparation and research
  • Quality care

When your case is in our hands, we hope to minimize stress and concerns associated with work. For dedicated representation with no upfront fees, give us a call at 323-866-9564 or email


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