Can a company going out of business refuse to pay your sick time, pay only part of your vacation and refuse unemployment benefits?

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Can a company going out of business refuse to pay your sick time, pay only part of your vacation and refuse unemployment benefits?

Asked on May 27, 2015 under Employment Labor Law, Massachusetts

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

1) No company *ever* has to pay out your sick time, unless your had a written employment agreement requiring them to do so. If you did not have such an agreement, yes, they can refuse to pay.

2) Similarly, not company *ever* has to pay out vacation time unless there was a written agreement.

3) Even if you had a written agreement for the payout of sick and vacation time, if they don't pay, then to get the money, you'd have to sue them for breach of contract. But if they are going out of business, even if you sued and won, you might not get any money, since there might not be any money to pay you.

4) The company does not pay out unemployment benefits--the state does. If you qualify for them under your state's laws, then if you were not fired "for cause" (such as for violation rules or policies of the company), you should get unemployment. Contact your state labor department to apply for the benefits and, if you are not getting them, to find out why--is your company claiming you were fired for cause? You may be able to appeal.


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