Questions to Ask If You Are Laid off or Fired
When you walk into what you think is a normal meeting with your boss and are surprised with a pink slip, it's devastating. Even if you absolutely, positively hated your job, when your boss yanks it out from under your feet, it hurts and you can't think straight. You should, however, ask a series of questions even if you feel your brain can't handle it. You can always call or arrange a later meeting to ask these questions.
Your employer will generally provide a stack of paperwork that you can go through on your own, so you may not need to ask some of the questions I recommend. But make sure you know the answers to all of them before you sign anything other than an acknowledgment that you have received information. (If you're an employer, these are the questions you will need to be prepared to answer in an employment termination situation.) Here are questions you need to ask to help you with decision making, planning and to consider your legal options.
Questions You Should Ask
- How much severance will I receive? Severance isn't required by law except in certain situations, such as a union contract or when a high percentage of workers are let go without 60 days’ notice (see the WARN Act), but severance is common in layoffs. Make sure you know how much severance is coming your way.
- Will I Be Eligible for Unemployment and Severance at the Same Time? Severance is a company decision and unemployment is a state decision. The company can't deny you unemployment, but they can say “if you are receiving unemployment, we won't give you severance”. Some companies require you to complete your severance payments before applying for unemployment. Their hope is that you'll get a job and won't ever need to apply for unemployment.
- What happens if I get a job internally? Are you eligible to apply for internal positions? What happens to your severance payments if you get a job internally? Is there a possibility of repayment if you take an internal position? Ask, "If I'm offered an internal position do I have to take it?", "If I don't take it, can I still receive severance?" and "What if it's for less money or at a lower level?"
- What happens if I get a job externally? Can I still receive my full severance? Do I need to get a release from the company to take a job elsewhere?
- Do you still consider me employed while receiving severance? What do you consider my termination date? If I'm receiving severance and someone calls to verify employment, is the answer employed or terminated?
- What happens to bonuses/commissions? Will I see the annual bonus, even if I've been terminated? When will you pay out final commissions? Will you prorate the bonus? How?
- What happens to my health insurance? Does it stop immediately? The last day of the month? Is it extended for the period I'm receiving severance? Do I immediately need to apply for COBRA or independent insurance?
- Am I eligible for rehire? Some companies don't allow the rehiring of anyone who was laid off. Others encourage everyone to apply for internal jobs. Some have a six month or one year waiting period between the termination and when you can apply for a new job.
- What will the company say is the reason for the termination? Is this a straight layoff or are there performance issues involved that will affect my reference? If a reference checker calls and asked why I left, what will you say?
- Is my manager allowed to give me a complete reference or is she required to stick to dates of service? Company policy dictates this, but sometimes it's formally written into the documents that the manager can only verify dates and titles. Understand that recruiters can often get managers to break the policy and speak up, but the policy is important.
- Who else are you letting go? They probably will not answer this directly, but you should be able to figure it out. If you are 40 years or older, you should receive a list of job titles and ages of the employees in your area and if they are terminated or staying. If it's a group termination and you don't receive this, ask for the ADEA (Age Discrimination in Employment Act) disclosure.
- If the termination date isn't today, what happens if I quit before the end date? Will I still get severance? Do I receive a stay bonus for staying to the final day?
- Am I responsible for training someone to replace me? This is often the case in a situation involving outsourcing. What are the training goals and what is the timeline? What happens if timelines aren't met? Do I still receive my severance/stay bonus on the last day even if the outsourcer isn't ready?
- What rights am I required to give up in exchange for severance? This should be in the General Release that you'll have to sign to receive money. Read it very carefully. You're most likely giving up your rights to sue for almost anything, except things that are strictly prohibited by law. That can vary from state to state, so read the document carefully.
- Can I have my attorney look at this agreement before signing? If they want you to sign right away, it's generally a sign that it's a bad deal for you. Any reputable company will not care that you're showing it to an attorney before signing and will, in fact, encourage you to do so. If you have an attorney review your documents, please make sure that the attorney you consult specializes in employment law.
- If I have a non-compete agreement, does this layoff void that? If I don't have a non-compete, is a non-compete required to receive severance? How long does the non-compete restrict my employment options? What are the restrictions? What's the geographic restriction?
- What happens to tuition reimbursement for courses I'm currently enrolled in? Can I finish the course and have the company pay? Am I required to pay for current courses? Am I required to repay for courses that I've completed? Your goal is to avoid any repayment.
- What happens to any relocation assistance that I've received? Most relocation contracts have a one to two-year repayment clause if you leave before the time is up. Make sure your termination documents waive any requirement to repay.
- Is outplacement help available? What company? What services are provided? Must I use the services immediately, or can I use them later? How long do I have to use the services? Is it only good in this town, or can I move across the country and still use the outsourcing help?
- Who can I tell about my severance? My attorney? Financial planner? Spouse? Neighbor? Newspapers? Lots of companies require you to limit who you tell to your attorney, financial advisor, and spouse. You can't even tell your kids the terms of the severance. Find out the terms of the nondisclosure agreement before you speak up.
Make sure that you have the answers to all of these questions before signing anything, otherwise, later you may regret your choice.