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Severance packages may lessen blow of layoffs, other termination

On Behalf of | Aug 3, 2021 | Employment Law

Running a New Jersey business involves a lot of forethought and attempts to predict how to handle hypothetical situations. For example, it may be necessary to consider whether to provide severance packages to certain workers in certain situations. This type of compensation package could apply if a worker or multiple workers need to be let go during a company layoff.

Severance packages can often provide employees with a specific amount of compensation in the event that they are let go. The package is intended to provide benefits to workers who likely have not prepared to change jobs due to the sudden layoff. The package could include the employee’s regular wages, additional salary for a specified period of weeks or months, compensation for unused vacation time or sick time, or other benefits.

In some cases, if a worker is leaving a company on good terms, the employer may want to help that worker get a leg up on finding a new position, which could include the following actions:

  • Acting as a reference or writing a letter of recommendation
  • Helping the employee update his or her resume
  • Providing access to any employment assistance programs the company may offer that the employee may not have access to otherwise

Of course, letting a worker go due to a layoff or for some other reason does not always go as smoothly as hoped. Some workers may take the news badly, not believe the severance packages are enough or believe that they were chosen for unseemly reasons, such as discriminatory reasons or as retaliation. In such cases, the process may become more complex, and having legal counsel would be wise for New Jersey employers.