Wrongful Termination and Severance Negotiations
By Robert A. Adelson
At Will Employment and Exceptions
1. Massachusetts is at will employment jurisdiction
- Employee may resign or Employer may terminate employment at any time
- With or without notice
- For cause or reason or without cause or reason
- With obligation to pay wages or accrued vacation pay and expenses through date of termination
- No right to continued employment
- No right to severance pay after termination
2. Presumption employment is At Will
- If nothing said or written and if no exception applies employment is at will
3. Exceptions to At Will doctrine – Contract
- Written Employment Agreement can supercede at will employment
- Terms of agreement on term, severance will control
4. Exceptions to At Will doctrine – Implied contract
- Offer letters
- Employee handbooks
- Policies
- Practices
- Oral promises
- Promissory Estoppel – detrimental reliance
5. Vigilence of employers to avoid Implied contract
Wrongful Termination by Statute
1. Termination for the wrong reason
- At Will employee can be terminated for no reason or any reason
- But cannot be terminated for an unlawful reason
2. Discrimination
- Age
- Race
- Gender
- National Origin
- Religion
- Disability
- Sexual Orientation
- Military status
3. Violation of Other Statutory Laws
- Civil Rights
- ERISA
- Equal Pay
- Family and Medical Leave Act
- Invasion of Privacy
- Plant Closings/ Takeovers
- Sexual Harassment
- State and Federal Tort Claims
- Wages and Hours
- Whistleblower Protections
- Worker’s Compensation
Tort, Equitable and Common law Claims
1. Implied Covenant of Good Faith and Fair Dealing
2. Violation of Public Policy
3. Negligent Hiring and Supervision
4. Interference with Contractual or Advantageous Business relations
5. Assault and Battery, False Inprisonment
6. Misrepresentation, Deceit and Fraud
7. Infliction of Emotional Distress
8. Fiduciary Rights of Minority Shareholders in closely held Corporation
Damages in Employment Termination
1. Contract Damages
2. Tort Damages
3. Statutory Damages
Demand Letter
1. Factual Background
2. Legal Claims
- Implied Contract
- Discrimination
- Other Statutory violations
- Good Faith and Fair Dealing
- Tort Claims
3. Demands
- Additional Consideration
- Changes from separation Agreement
- Attorney’s fees
4. Litigation
- Deadline or recourse to litigation
- Notice to preserve electronic records
Employment Litigation
1. MCAD filing requirements for discrimination claims
2. Complaint – Claims made and their survival
3. Discovery – plan to gain information to enhance case
4. Motions and briefs
5. Trying the case
Negotiating Severance and The Separation Agreement
1. Severance Pay and Benefits
- Amounts and timing
- Allocations to Emotional Distress, Attorneys fees and medical expenses to save taxes
- Payments for attorneys fees, outplacement and other specific costs to enhance severance
- Medical coverage
- Other Employee Benefits
- Duration of severance
2. Job Search and reputation
- Outplacement
- Office Space
- Inquiries from contacts and potential employers
- References
- Confidentiality
- Mutual non-disparagement
3. Releases
- Mutual release
- Legal rights
- Rights to enforce settlement
4. Enforcement
5. Cooperation
Robert A. Adelson, Esq. is a corporate and tax attorney and partner at Engel & Schultz LLP, Boston, Massachusetts. executiveemploymentattorney.com He represents C-Level executives and key employees in negotiations over employment terms, equity, compensation, relocation, retention, wrongful termination, severance negotiations and separation agreements. He also works with employment litigators at his firm who have successfully brought suit for executives over claims for wrongful termination.
© 2009 Robert A. Adelson
