Attorneys at Law

Be Informed.

Be informed.

Can My Company Refuse to Pay My Severance?

When the employer-employee relationship ends, it does not necessarily mean the employer’s financial obligation to the employee ends. Often, an employee is entitled to a severance package when his or her employment is terminated with an employer. If you have recently severed your relationship with your employer and your employer has yet to pay your severance, you may be wondering “Can my company refuse to pay my severance?” The answer to that question is likely going to be found in your employment contract.

Like many states, the Commonwealth of Pennsylvania is an employment “at will” state, meaning that an employee can be let go for any legal reason, or for no reason at all, unless the parties entered into an employment contract before the employment began. If you do have an employment contract with your employer, the terms of the contract will govern most employer-employee issues, including severance when the employment relationship ends.

In the absence of provisions in an employment contract entitling you to severance pay, an employer is generally under no obligation to provide you with any type of severance when your employment ends with the company, unless the company has a policy that includes payment of severance pay to all employees upon termination of their employment.

If you have an employment contract with your employer, the issue of severance pay is likely addressed in your contract. In that case, your employer is legally obligated to comply with the terms of the contract. Pay close attention, however, to any conditions that allow your employer to get out of paying severance pay even if it is included in your contract. For example, employers commonly include a provision that voids your right to severance pay if you are terminated for cause, meaning you were fired. You may also be required to give your employer sufficient notice of your intention to resign your position in order to be eligible for the severance package guaranteed to you in your employment contract.

Finally, recent case law in Pennsylvania may open the door for the argument that an employee had an implied employment contract with an employer. Heretofore, only a written contract would suffice if an employee wanted to bring suit for damages resulting from unfulfilled promises made by an employer. It now appears, however, that the courts may be willing to consider an implied contract.

If your employer has refused to provide you severance pay to which you believe you are entitled, contact an experienced Conshohocken employment law attorney as soon as possible to discuss your options. Contact the employment law attorneys at Curley & Rothman, LLC by calling 610-834-8819 today to schedule your consultation.