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Archive for the ‘severance agreements’ Category

Partner, Eric LeBlanc, quoted in Massachusetts Lawyers Weekly Article Regarding an Employee’s Successful Post-Termination Claim of Workplace Retaliation

Posted on: January 11th, 2018 by admin

wwa_eric-117x150Massachusetts Lawyers Weekly sought commentary from Bennett & Belfort partner, Eric LeBlanc, in its article on a recent U.S. Bankruptcy Court decision concerning a contract worker’s claim against her former employer’s Chapter 11 bankruptcy estate for severance pay.  (“At-will worker can seek severance against bankruptcy estate: Company’s failure to offer benefits deemed retaliatory,” Mass. Lawyers Weekly, December 21, 2017.)  Dr. Christine Briggs, while an at-will employee of Genesys Research Institute, Inc., was one of a number of workers who filed whistleblower complaints against the company for alleged misuse of restricted funds.  Although an employer is not required to offer severance pay when laying off an at-will employee, Dr. Briggs discovered that when Genesys terminated at-will employees in a series of layoffs prior to filing for bankruptcy, it had systematically offered severance to those who had not lodged whistleblower complaints but failed to offer severance to those who had made complaints.  In the case, In Re: Genesys Research Institute, Inc., Justice Joan Feeney concluded that the employer’s conduct was retaliatory, and thus Dr. Briggs, although an at-will employee, was entitled to claim severance pay.

Attorney LeBlanc remarked that the Judge’s decision is significant because the court sustained a claim concerning an employer’s retaliatory conduct that occurred after the employee’s termination.  “There are mitigating factors in this case because it was a bankruptcy decision with a different burden-shifting, and the trustee made limited attempts to refute the claim,” Attorney LeBlanc told Lawyers Weekly. “But it could still be applicable in assisting plaintiffs in getting over an initial hurdle regarding a potential retaliatory action that occurs post-termination… Put more simply, you can use post-termination employer behavior to potentially prove either discrimination or retaliatory animus.”

From a common-sense, layperson’s perspective, it goes without saying that retaliation and discrimination by any person or entity against another can post-date the technical termination of the relationship between perpetrator and victim.  The case law in this regard is, however, a work in progress.

BENNETT & BELFORT WELCOMES ATTORNEY CRAIG LEVEY TO FIRM

Posted on: June 13th, 2016 by admin

 

 

Levey Craig (2)

Bennett & Belfort, P.C. is pleased to announce that Attorney Craig Levey has joined the firm.  Mr. Levey focuses his practice on employment and business matters, representing both individuals and companies.  He litigates claims of discrimination, sexual harassment, retaliation, and wage & hour disputes, as well as partnership and fiduciary duty issues.  Mr. Levey also drafts, reviews, and negotiates non-competition, non-solicitation, and severance agreements, and routinely counsels companies on all facets of the employer-employee relationship, including the drafting and implementation of company policies, procedures, and employee handbooks.

Mr. Levey has experience in a wide variety of cases in Federal, Superior, and District courts, and before administrative tribunals, including the Massachusetts Commission Against Discrimination, Department of Unemployment Assistance, and the Division of Administrative Law Appeals.

Commenting on the move, Mr. Levey said, “Bennett & Belfort offers a creative and collaborative environment to work, which is the perfect platform for me to grow my practice.  I am excited to join such a strong and determined team of attorneys, and I look forward to continuing the firm’s tradition of delivering top-notch service to its clients.”

Mr. Levey is a former associate attorney at Looney & Grossman, LLP and Davis, Malm & D’Agostine, P.C. in Boston.

SEVERANCE PAY: A BALANCING ACT

Posted on: October 30th, 2012 by admin No Comments

While some employers elect to offer separating employees some form of severance package, employees are not usually entitled to any severance payment, unless by pre-existing contract. 

The primary reasons that businesses offer severance packages to departing employees include to: 1) reward them for their services and tenure at the business; and/or 2) in order to obtain a waiver and general release of claims from the employee, and to ensure that the employee will not take legal action against the company in the future; and/or 3) to confirm that the employee agrees to continue to be bound by a restrictive covenant, such as a confidentiality provision, non-compete agreement or a non-solicitation agreement.

A severance agreement is a contract, which once properly executed is enforceable in Court.  Like any other contract, the terms of a severance proposal should be carefully reviewed with legal counsel and are often negotiated – sometimes between the parties and other times between lawyers.  Because the parties are agreeing to be bound to contractual terms and/or relinquishing certain rights, such agreements must be carefully considered during a period of transition for both the company and employee.

Some severance offers are simply an agreement to pay the separating employee either a lump sum of money or recurring payments over a period of weeks or months in exchange for a general release or waiver of claims.  Other severance offers are more comprehensive, and may selectively include some or many of the following terms:

Continued insurance coverage or other benefits (health insurance, dental, life, disability etc.);

  1. The extended vesting of employee stock options or profit sharing;
  2. A letter of recommendation or a non-disparagement agreement;
  3. A re-characterization of the employee’s departure as “voluntary”;
  4. An agreement by the employer not to contest unemployment benefits;
  5. An agreement by the employer to pay for the employee’s career counseling;
  6. Relocation expenses (if applicable); and
  7. Assurance from the company that it will narrow or not enforce a restrictive covenant, such as a non-competition agreement or a non-solicitation agreement.  

Employers will generally seek to include severance terms that bring closure to the matter.  Employer’s will invariably include terms that limit the likelihood of having to defend a lawsuit, avoid bad publicity or the dissemination of disparaging information,  while protecting intellectual property, including their valuable trade secrets.

From the employer’s perspective, it is agreeing to pay a certain sum of money that it is otherwise not necessarily legally obligated to pay, in consideration for a release of potential legal claims that the employee may otherwise pursue.  If there are strong claims or potential claims by an employee, the employer has and increased incentive to secure a release from the separating employee so that costly and prolonged litigation might be avoided.  On the other hand, employers are often concerned about setting a precedent of large payouts, particularly in this fragile economic climate where reckless spending can contribute to a company’s downfall. 

From the employee’s perspective, a comprehensive review of the proposed severance is crucial.  First and foremost, does the employee have strong legal claims against the employer, such as discrimination, breach of contract, or a wage violation (including overtime)?  If so, does the severance offer approach or exceed the potential value of such claims verses the costs of litigation?  It is important for employees to ensure that the non-monetary terms are balanced, reasonable and when at all possible, mutual. 

While employees are not legally entitled to severance packages, well negotiated and carefully drafted severance agreements can be of great benefit to both employers and employees.  As straightforward as some of the severance agreement issues might appear, there are many traps for the unwary with seemingly innocuous terms having ramifications well into the future for all parties. 

Bennett & Belfort, P.C. regularly drafts, reviews, negotiates and litigates severance agreements and related issues.