Would I be able to get some sort of award if if my severance wasn’t paid on time?

UPDATED: Sep 8, 2011

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Would I be able to get some sort of award if if my severance wasn’t paid on time?

The company told me that I would be getting 2 weeks of severance pay since I was with the company for 2 years. The store manager also told me that as soon as I submitted all my paperwork I would be getting my paychecks. He also stated that it would be paid in full within 2 weeks, 1 week 1 check and  the next week the other. The severance pay paperwork I had to sign was also stated the same. Now we are on the third week and I haven’t gotten my last check. I currently have a case with the labor board and the company. Can I receive anything from them for not paying me on time and causing my not to be able to pay my bills?

Asked on September 8, 2011 under Employment Labor Law, California


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

If a company violates its agreement as to when to pay severance, then the recipient of that severance could theoretically sue the company for any additional damages flowing out of the late payment, such as bounced or dishonored check fees, interest (if money had to be borrowed to meet obligations), etc. However, the problem is that you could only receive compensation equal to your actual out of pocket losses or expenses, and that you would have to sue them in court (I don't believe the labor board could award you anything for this, but you can certainly ask). That means that unless you had unusually large out of pocket losses or costs, it would not be worth taking action, since the cost of the lawsuit would likely exceed what you could recover.

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