What to do if I was laid off 6 weeks ago at which time I signed a severance agreement stating that I’d be paid within 10 business days but I still haven’t been?

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What to do if I was laid off 6 weeks ago at which time I signed a severance agreement stating that I’d be paid within 10 business days but I still haven’t been?

I signed the agreement stating that I would be paid 1 week severance, payable w/ in10 business days after the execution of the agreement. I called questioning where the payment was on 6/19 and was told that the 10 business days is “AFTER the agreement is executed by all parties” I have also not received my final pay which is for a couple of weeks unused vacation time. I’ve attempted to call a few more times. Are there any legal issues related to my not being paid yet based on the agreement? Anything that I can do?

Asked on July 9, 2012 under Employment Labor Law, Ohio

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

1) A severance agreement is a contract, and is enforceable as per its plain terms, like any other agreement. Furthermore, all contracts have an "implied covenant of good faith," or an obligation imposed by law on all parties to the contract, to act with good faith vis-a-vis each other. If you should have been paid within 10 days but have not been paid for 6 weeks, then even if the employer claims it's because they haven't signed it yet,  since that shows bad faith, you can likely sue for breach of contract and breach of the implied covenant as well.

2) Employees must be paid their final paychecks, typically by when the next scheduled payday would have been. You may sue to recover any pay you were owed, including for vacation pay, if the employer was supposed to pay you for vacation days.

On option is to file suit in small claims court, where filing fees are low and you can act as your own attorney.


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