VIEWS: 9 PAGES: 2 CATEGORY: Business & Economics POSTED ON: 6/13/2010
[...] develop a clear plan setting forth the business purpose supporting the layoff. [...] a severance package may quell a former employee's feelings of helplessness or resentment, reducing the likelihood of legal action.
LAW Keeping lawsuits at bay as laid-off employees head to court NEW JERSEY’S unemployment rate has — is similarly rising. Each of these can lead to actions you can take to avoid future litigation. Instituting layoffs based on broad, undocu- climbed to its highest level in more than a very costly and protracted litigation. First, develop a clear plan setting forth the mented reasons, such as general cost savings, decade, and the rate of employment-related So, how can you, as the employer, successful- business purpose supporting the layoff. Docu- may be more difficult to defend. legal claims against employers — from allega- ly weather a slowing economy, while at the same mentation confirming the business reason Next, document the objective criteria to be tions of underpayment of wages, to employ- time insulating yourself from potential legal liabil- behind the decision will be instrumental in used in determining which employees will be ment discrimination, to wrongful termination ity? The following are suggestions for pre-emptive defending against employment-related claims. laid off. Make ter- mination decisions based on neutral, quantifiable fac- tors. For example, subjecting the least-senior person in each department to a layoff will serve as a better defense to potential unlaw- ful termination Melanie J. Perez-Vellios claims than will subjective factors, such as whether specific employees are a good fit. Employers also should consider offering sev- erance packages to terminated employees, as even a small severance package can extend price- less legal protection. First, a severance package may quell a for- mer employee’s feelings of helplessness or resent- ment, reducing the likelihood of legal action. And if properly drafted, a severance agreement can thwart future legal action by the employee. In order to maximize the legally binding effects of a severance agreement, the terms of every package should be clearly set forth, and the agreement should contain a release of all Clients know they can depend on legal claims against the employer through the termination process. Bederson & Company. For over However, not all severance agreements are 70 years, we hav
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