Job Loss Basics
Created by FindLaw's team of legal writers and editors | Last reviewed June 20, 2016
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Losing a job is often a stressful and traumatizing experience, particularly when it comes as a surprise. Employees who've been laid off, terminated, or left on their own accord may have questions about continuation of health benefits, unpaid wages, or even the legality of the action itself. Those who leave a job have plenty to do: applying for unemployment insurance, updating the resume, contacting references, and looking for other jobs. Meanwhile, unemployment typically creates a great deal of financial hardship and also can erode one's emotional well being. FindLaw's Job Loss Basics section includes a number of helpful resources and articles, with information on how to cope with the loss of a job, employee rights after termination, and more.
Losing a Job: Lawful vs. Unlawful Termination
Most employment situations are "at will," which means an employee may be fired for any reason or no reason at all as long as it doesn't violate state or federal laws. If you are able to show that you were fired because you got pregnant, for example, that would be a violation of anti-discrimination law and constitute an unlawful termination. Also, employers must honor the terms of any written or oral employment contracts they have with employees. If an employer terminates an employee by violating a contractual provision -- even if it isn't written -- the employee may be able to file a claim. Even vague promises of the future (such as the promise of tenure or a higher position) can be construed as a contractual term.
Severance Pay and Your Final Paycheck
Employers are not required to offer severance pay to departing employees, although some employers offer severance to laid off employees. However, 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 also may be contractually binding if it is mentioned as a policy in the employee handbook, severance pay has been offered to similarly positioned employees, or if the employer orally promised severance pay. Companies that offer severance typically base the amount on the employee's length of employment.
An employee's final paycheck is not optional and state laws dictate the manner in which the final paycheck is to be paid. California law, for instance, requires employers to immediately provide the last paycheck to terminated employees (or those who quit with at least 72 hours notice), or within 72 hours if the employee quits without notice. These are very specific regulations that vary from state to state. Again, contractual language may dictate another course of action.
How to Cope with Job Loss: The Basics
If you do find yourself out of work, whether you were terminated, laid off, or left on your own accord, there are some steps you can take to soften the blow. If you were terminated, make sure it was not done for unlawful reasons or in violation of an employment contract. If so, you may be able to recover lost wages and perhaps get reinstated. Here are some suggestions for how to proceed after a job loss:
- File for Unemployment Insurance Compensation: If you lost your job through a lay off (or otherwise through no fault of your own), you may be eligible to receive compensation for up to six months until you find another job
- Collect Any Unpaid Compensation: In addition to your final check and any contractually guaranteed severance pay, you also may be entitled to pay for accrued vacation time
- Continue Health Care Coverage: Under federal law, terminated employees may continue receiving health benefits (at full cost) for up to 18 months
- Get Your Resume Up to Date: Update your work experience, contact and update your references, and make sure your resume is properly positioned for the job you seek
- Tighten the Belt: When you're unemployed, it's imperative that you trim expenses as much as possible; don't take on new debt and contact creditors if you need to renegotiate debt repayment
- Consider Part-Time or Odd Jobs: You may not find the perfect job right away, but it may be necessary to stitch together a few odd jobs in order to make ends meet; but keep in mind that you may lose your unemployment benefits by accepting work
Losing a job can be devastating, both financially and emotionally. The following articles and resources will help you pick up the pieces and prepare for your next job.
Learn About Job Loss Basics
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