By Maurice Arcadier, Board Certified in Labor and Employment Law
As labor attorneys, one of the most common questions we are asked concerns severance pay for employees.
The short answer is that if there is no contract or agreement between an employer and employee concerning severance, Florida Law does not require an employer to pay severance.
There are many exceptions to this fact.
First, if the employer normally pays severance to other employees, then, if the employee is similarly situated as those employees, then the employer can be accused of discrimination against the singled-out employee, particularly if the employee has part of a protected class such as age, gender, race, ethnic background or has a disability. In other words, a Florida employer can not discriminate against the employee as compared to other employees, even in the handling of a termination.
Of course, if there is an employment contract which offers severance or post-employment pay, then Florida Law will enforce the terms of the agreement.
As a practical matter, many employers still pay severance pay upon the non-adversarial departure of an employee. Some employers will offer severance in exchange for the employee signing a full release, confidentiality agreement, anti-disparagement clause and a cooperation agreement post-employment. This is a new post-employment contract which results in the employee waiving all rights to sue employer as well as protect the employer from being disparaged, in exchange for a monetary sum. The sum can be any amount which is agreed to by the employee and employer but is customary to be one week of pay for every year of service, with a cap which is often about 20 weeks.
If employer is making the employee sign a non-compete agreement, it is best for the employee to seek severance pay as part of the non-compete period during the duration of the post-employment non-compete period.
Since Florida Law does not protect employees with a regulated law, rule, or regulation as it concerns severance pay, employees should try to negotiate a severance pay if there is a termination of employment BEFORE accepting the job. Employees should understand that private companies are primarily in the business of making money and it is unlikely that a private company will simply give severance pay for an altruistic purpose. Instead, the employer requires the employee to “sell” any rights the employee may have to sue the employer, in exchange for a monetary severance sum. This value comes in the form of closure for the employer as well as a legal agreement to prevent the employee from disparaging the employer.
Indeed, after a termination, if the termination is adversarial, there are many issues which may arise. For instance, if employer is sued and the ex-employee has relevant information, a cooperation clause as part of a severance package would require employee to cooperate with employer and employer’s attorneys.
And, while defamation is illegal in Florida, without a severance agreement, the employee can go on all social media platforms and publish negative truthful opinions about the company. This is not illegal and it is not defamation as it is simply disparagement. And, unless there is an anti0disparagement contract between employee and employer, employee is free to exercise his or her Constitutional rights.
Even though Florida has no laws that mandate for severance pay to a departing employee, it is often in the best interest of employer and employee to enter into a fair and balanced severance agreement where employee gets some money for its transition into a new job, and the employer gets closure and post-employment litigation protections.
It should also be observed that before entering into such agreement, it is best practice to discuss your situation and reasons for termination with an experienced employment law attorney so that your rights can be discussed, and the value of your potential case assessed. Indeed, it would not be in employees’ interest to accept a severance claim and waive his or her rights if what the employee is waiving is worth more than the severance.
AN employee can expect to pay a consult fee, and if there is a worthwhile case, meaning, a financially feasible case which is worth pursuing, the attorney can offer to take the case on a contingency fee basis, meaning, other than the consult fee, the attorney would provide all services based on a percentage of the recovery.
Employees seeking legal advice should consult with an experience Law Firm that specializes in employment law as many aspects of employment law are esoteric, even to attorneys. Maurice Arcadier from the Law Firm of Arcadier, Biggie and Wood, PLLC is specially board certified by the Florida Bar in Labor and Employment Law with 22 years of legal experience representing employees and employers in Florida Law and Federal Employment law cases.