Unemployment rates in the state are high and employers often find it difficult to meet their many financial obligations. Severance pay may be a good trade policy, but a severance agreement should be well developed and part of the employment negotiation process. We have all heard the old saying: "Nothing in life is free." This proverb applies in particular to agreements of severance. If your employer gives you severance pay at the end of your employment, they will almost certainly expect something. To declare unemployment, employers must declare all gross wages including wages, commissions and bonuses. According to the Kentucky Workers` Employment and Training Office, severance pay is not a "salary" if paid according to a plan that applies to all workers or workers in a working class and is calculated on the basis of service time. The tax consequence of a severance package should therefore be taken into account. As described above, your employer expects something in exchange for the offer of severance pay. It may be an agreement to enter into a non-compete agreement, or even an agreement to result in your replacement. You need to be aware of these obligations and balance your costs against the benefit you will receive from the term contract.
For example, if your employer requires you to sign a two-year competitive contract versus 8 weeks of severance pay, who will actually benefit from this agreement? At least you need to be aware of these pitfalls and, ideally, negotiate them entirely from the term agreement. Losing a job is a difficult and stressful time, and you shouldn`t waste time wondering if you`re being treated fairly when it comes to a stress package. Contact Abney Law`s lawyers and let us guide you through this uncertain time and get the cheapest severance package. The reality is that most employers do not offer severance packages or severance pay when they dismiss an employee. Kentucky law does not require employers to offer severance pay, and most employers will get in touch to prevent a laid-off employee from paying anything — that`s where Abney Law`s lawyers come in. We negotiate reversance packages from scratch for many customers every year. The key to negotiating severance pay is to find subtle leverage against the employer and use them. This leverage can take the form of dismissal - for example, the dismissal was discriminatory, was it retaliation, or you were fired after you called a legal right such as medical leave under the FMLA. Leverage can also come from the way you were treated during your work - you were illegally harassed, refused overtime or forced to work in precarious conditions.
Our lawyers are very experienced in finding these leverage points and with them to get you the severance package you deserve. When a new client arrives in our office with a proposed compensation package, he often wonders if he has to ask for anything other than severance pay. Severance agreements can be negotiated and tailored to the specific needs of each situation. Several improvements we often look for in our clients` severance contracts are the most common: the most common question about this is whether an employer is legally obliged to remove an employee when fired. The short answer to this question is no. Our Kentucky Employment Law Blog contains an article, Am I Entitled to Severance, which deals with this issue, but in general, unless you have a written contract that says otherwise that Kentucky employers are not required to pay severance pay at the end of the employment.