What To Do After Losing a Job: Employee Rights and Next Steps
By Olivia Wathne, Esq. | Legally reviewed by Melissa Bender, Esq. | Last reviewed March 27, 2024
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A job loss can be a difficult experience and cause significant challenges. It can also raise many legal issues and questions about employment rights. If you quit a job or experienced a layoff, this section can provide tips on severance pay, wrongful termination claims, and much more. While losing a job is rarely a pleasant experience, knowing your rights can help make the transition much smoother.
Employee Rights Following a Job Loss
Most employment relationships are "at will." This means employers are free to terminate employees at any time and for any reason, as long as it's not illegal or in violation of a contract. Assuming you either quit your job, were laid off, or were legally terminated, you still have a few rights as you depart. These include:
- The right to receive a final paycheck
- The option to continue an employer-sponsored health care plan through COBRA
- Eligibility for severance pay or accrued vacation pay, if applicable
- Eligibility for unemployment insurance benefits
Wrongful Termination
Even in states with at-will employment laws, there are certain instances where it is illegal to terminate an employee. When an employer fires an employee for unlawful reasons, the terminated employee may file a claim with the Equal Employment Opportunity Commission(EEOC).
If the EEOC finds merit in the claim after investigating, then the claimant may file a civil lawsuit. Damages may include reinstatement and monetary awards.
Most cases of unlawful termination involve employment discrimination based on one or more protected characteristics. Federal law prohibits termination due to race, color, gender, pregnancy, age, disability, religion, or national origin. Some states extend these protections to LGBTQ individuals and other marginalized segments of the population.
Severance Pay and Your Final Paycheck
Employers are not required to offer severance pay to departing employees. However, some employers offer severance to laid-off employees. Any employer who includes severance pay in the terms of an employment contract is required by law to do so.
Other than a written contractual provision, severance pay may be binding if it is a policy in the employee handbook if the employer has offered it to similarly-positioned employees in the past, or if they made an oral promise about severance pay. Companies that offer severance often base the amount on the employee's length of employment.
An employee's final paycheck is not optional. State laws dictate how the final paycheck is to be paid. California law, for instance, requires employers to provide the last paycheck to terminated employees within 72 hours if the employee quits without notice.
Unemployment Benefits
Workers who lose their jobs may apply for monetary benefits through their state's unemployment insurance (UI) program until they become employed again.
Some applicants receive extended benefits while attending school to retrain for a new occupation. To be eligible for these benefits, the employee has to have lost their job through no fault of her own.
Most employees who quit or are fired aren't eligible for unemployment compensation. Those who are unfairly terminated or leave for a valid reason caused by the employer can apply. In such cases, the decision is based on whether a reasonable person in a similar job situation would have also left.
UI benefits are payable for a specific amount of time, usually up to 26 weeks. The federal government, which provides partial funding to state UI programs, will often extend this during times of economic hardship.
If you are denied benefits and believe this decision was reached in error, you may request a UI hearing.
Legal Help After Losing a Job
If you've lost your job and have concerns about your legal rights, seeking legal advice is crucial. An employment attorney can provide invaluable assistance in understanding your rights and options. They specialize in employment law and can offer guidance on matters such as wrongful discharge, workers' compensation, or negotiating severance agreements.
Consider consulting with an experienced employment lawyer for legal advice.
