Do You Lose Your Pension If Fired?
Whether you resign or are fired, losing a job is never easy. And, it's not just the loss of income that can be difficult, but also the loss of benefits. For example, deputy FBI director Andrew McCabe was fired just two days before his retirement, which means he's no longer eligible to receive his full pension. Pensions and other benefits are generally terminated when you're fired, but there are certain rights that an employee has after his or her job has been terminated.
Rights of an Employee After Job Termination
Today, the standard type of employment is "at will," which basically means that you can quit or be fired at any time and for any reason. One caveat to this, however: the reason can't be for something illegal, like discrimination or retaliation. Employees do have certain rights after being fired.
For example, you may enter into a severance agreement, which basically means that you'll receive a severance package in exchange for promising not to sue your employer. Severance pay is not necessarily right, unless it's in an employment contract or the employee handbook has a policy on severance pay. Most employees who are fired or resigned also have a right to continuing health care coverage under COBRA, although the former employee is responsible for making the full premium payments.
Rules of the Pension Plan
Whether or not you can keep your pension depends on whether or not you're vested in the pension plan, and when that vesting occurs is dependent on the rules of the pension plan. It's very common for employers to require a certain condition -- such as employment for a certain number of years -- in order for the plan to be vested. Once a person is vested in a pension plan, he or she has the right to keep it. So, if you're fired after you've become vested in the plan, you wouldn't lose your pension. It's also possible to be partially vested in a plan, which would mean that you could keep the portion that has vested even if you're fired.
It's important to keep in mind that even when an employment is at will, if you're fired for an illegal reason, you may be able to bring a claim for wrongful termination. If you have questions about the legality of how you were fired, it's a good idea to reach out to an employment attorney near you who can assess your situation and advise you on whether or not you may be able to bring a wrongful termination lawsuit against your former employer.
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