Severance Pay after Wrongful Termination: Does it Limit Your Options? By Dan Atkerson on March 10, 2019

When someone is fired for discriminatory reasons or in retaliation for reporting employer wrongdoing, there may be grounds for a wrongful termination claim. A wrongful termination lawsuit can help hold employers accountable for discriminatory practices.

When a person believes his or her termination was wrongful, it is important to consider all legal options before accepting a severance package. Accepting severance pay can severely limit legal recourse.

Attorney Dan A. Atkerson has handled wrongful termination and severance pay cases in and around the Dallas, TX area and can help you if you believe you have been wrongfully terminated.

What Is Wrongful Termination?

Although it may feel like being let go from a job was “wrongful,” not all terminations fit the description of a wrongful termination.

Wrongful termination is a legal term that refers to being fired for an illegal reason. A firing may be considered a wrongful termination when a person is let go in violation of federal anti-discrimination laws or a breach of contract.

Anti-discrimination laws protect individuals from being fired based on their race, ethnic background, religion, gender, or disability. An employee also cannot be fired for filing a legal complaint against an employer or for reporting an employer's wrongdoing, commonly referred to as whistleblowing.

What Is Severance Pay?

Severance pay is money and benefits given to an employee when he or she is asked to leave a company. Severance pay is generally given in addition to a final paycheck.

Severance pay is calculated in different ways and will consist of different benefits based on the employer. However, it is common for severance pay to include a payment based on the months or time spent with a company. Severance pay may also include unused vacation time, holiday pay, and sick leave.

Accepting Severance Pay May Limit Wrongful Termination Legal Options

Receiving severance pay can help alleviate financial strain and stress while unemployed, but it can limit a person's legal options in the event of a wrongful termination.

Before accepting a severance package, it is important to be aware that accepting severance pay may limit your legal options and prevent you from pursuing a wrongful termination case in court. This is because accepting severance pay is often interpreted as the former employee agreeing to the terms of the termination.

Consult an Attorney before Accepting Severance Pay

It is important to speak with an attorney before accepting a severance package. An attorney can review the details of the termination to determine if any violations of anti-discrimination law or breach of contract occurred.

If evidence of a wrongful termination is present, not accepting a severance package often allows the wrongfully terminated employee the option to seek recourse in court.

In some cases, court may be avoided and a fair severance package may be negotiated between an employer and former employee with the help of an experienced attorney. However, even accepting a fair, negotiated severance package generally means the former employee must agree not to pursue further legal action against the employer.

Contact the Law Offices of Dan A. Atkerson

If you believe you may have been wrongfully terminated, it's important to explore your legal options before accepting any severance pay or package. Attorney Dan A. Atkerson can review the details of your case to help determine the best course of action for your circumstances. To schedule a consultation, please call our law offices at (214) 383-3606.