How long does a company to make a lump sum severance payout?

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How long does a company to make a lump sum severance payout?

I was laid off with a month ago and with 52 weeks of severance pay payable in a lump sump. Is there is law that states how long after a termination date does a company have to make the lump sum severance payout?

Asked on September 29, 2011 under Employment Labor Law, Illinois

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

No, there is no law governing this. Severance is not required by the law--companies don't have to pay it. If they pay it, it's because they choose to. Thus, the terms of severance, including when it is payable, are governed by the offer the company made to the employee and the agreement formed between the employee and the company. If the agreement is silent as to when the severance has to be paid (note for the future: always make sure your severance agreement includes when it has to be paid), then the best you can do is try to determine what would have been the reasonable intention in mind, by looking to the timing of severance payments made by this company to other employees in the past, or industry norms, or the typically timing for severance for employee of your level and type, etc. When a more-than-reasonable time has passed--whatever that is--then it's time to start thinking about legal action.


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