Must my former employer continue to pay me retention/severance as per release agreement if they rehire me?

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Must my former employer continue to pay me retention/severance as per release agreement if they rehire me?

After not accepting an out-of-state relocation, my employer offered a retention/severance package to stay until this month, with assurances that they would find me suitable employment before then. That did not happen and I was laid off (3 weeks ago). Release agreement was signed by myself and employer. Agreement does not discuss/stipulate any termination of payment should I be rehired (which i was 04/19/11). Employer now offered a job that pays 30% less than my old salary. Offer letter discusses reinstatement of benefits but no mention of retention/severance termination. Must I take or can I refuse this job, and what happens if I do?

Asked on April 21, 2011 under Employment Labor Law, New Jersey

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

1) You don't have to take the job except inasmuch as if you're collecting unemployment, refusing to take it may render you ineligible to collect; so just weight that, if it's a factor, in your decision.

2) If you are rehired without any agreement, prior to rehiring, about repaying severance, you don't need to repay them (unless the severance agreement itself had something in about repayment in the event of rehiring.

3) However, if the severance is being paid over time rather than lump sum--e.g. you are being essentially continued on payroll and on insurance--then in that case, it would probably be that the severance would discontinue on rehiring, since in essence you'll have swapped being on payroll at X level (e.g. being continued on payroll as your severance) for being on payroll at 70% of X. So if you're being paid over time, depending on how its structured, you *might* lose the payments.

Again, though, you can't be forced to take the job as a general legal matter (unless, as stated, there's something in the severance package/agreement about rehiring).

4) If they offer you the job, the offer could be made contingent on repaying severance; then you'd have to decide what to do. This would need to happen prior to accepting; once you accept a job offer, they can't change the terms after the fact.


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