Can a company lay off 100’s of empoyees and tell them that they have to work until a certain date if they want their severance?

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Can a company lay off 100’s of empoyees and tell them that they have to work until a certain date if they want their severance?

Over 200 people were layed off last week from a company with different end dates,

so I have to work for another 4 months if I want my severence pay. I was just promoted to another department 4 months ago. Is this legal?

Asked on November 3, 2016 under Employment Labor Law, Massachusetts

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

Most employment is "at will". This means that a company can set the conditions of employment much as it sees fit. This includes if and when an employee receives severance pay. The fact is that such pay is a discretionary benefit that an employer can choose to provide or not, therefore it can place whatever restrictions on it as it chosses. Accordingly, unless this action violates the terms of a union agreement or employment contract, it is legal.

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 5 years ago | Contributor

There is NO obligation to pay severance whatsoever, unless and only if you already had a written contract guarantying you severance. (If you did, the company has to do or pay whatever the contract says; if it doesn't, you could sue for breach of contract.) Since severance is completely optional and voluntary for the company, the company has the right to set any restrictions or requirements it likes on it, such as requiring you to work until a certain date to get your severance, since the alternative is, they could have simply laid you off without any severance.


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