Severance/Release & Unemployment

[Terrapin69]

What is the name of your state (only U.S. law)? Illinois

From my understanding, there is nothing you can sign that can specifically prohibit your filing for and receiving unemployment benefits in IL; however, I was recently let go, no misconduct or fault of my own, by my employer in Illinois and received 2-weeks of pay as a "severance". Buried in the document I was forced to sign on the spot is a clause that reads, in part, "...employee promises not to file a claim against the employer...this includes unemployment claims".

Like I said, every article I have read states that this verbiage is "null and void" in IL as an employer cannot force and employee to waive this right.

I also have a glowing letter of recommendation from the employer stating I was fired due to restructuring - which is accurate.

Will I be denied my benefits - In your honest opinion?

Thanks,

 

[PayrollHRGuy]

No you won't be denied.

Though you could be sued for breach of contract. But I can't find any case like yours where the former employee lost such a suit.

 

[Terrapin69]

Thanks

What I thought... Are you an attorney

 

[PayrollHRGuy]

No I've been in HR for 18 years and have worked thousands of UI claims for my clients.

I'd be willing to bet that the average HR person that works UI cases knows more about UI laws and regs than the average lawyer.

The suit comment was simply because you signed an agreement that you wouldn't do something and they gave you money at least in part because you said you wouldn't do something. But I doubt it would stand up on the basis of being against public policy.

 

[commentator]

Sometimes companies will put things like this into their contracts and severance agreements. If such an agreement comes to the attention of the state unemployment service, they'll probably send them a nice letter telling them not to do this anymore.

But since the employer cannot exclude you from being able to sign up for unemployment benefits simply by putting this into a contract, you need to go ahead and file at once. There wouldn't be any lawsuit against you, I promise, as they are flat out breaking the law by including this clause. It's like if they had you sign a contract that said it was okay with you not to be paid overtime or the federal minimum wage. It legally doesn't amount to anything, since you cannot sign away your legal rights. I'm not an attorney but I spent many years fooling with employers and unemployment benefits and do know some unemployment insurance law. I've seen a few of these idiotic contracts of this type.

Even receiving severance or any sort of a pay out doesn't make you ineligible for unemployment, depending on your individual state of residence and how it is handled there. Your best bet is to file the claim right away, provide them with full details about the amount of severance, etc. and let them decide how to proceed.

The thing is, when a person drawn unemployment insurance, which according to federal law they have a right to do if they are put out of work through no fault of their own, it causes the employer's unemployment tax rates to increase. Wishing to keep their costs down, the employer hopes they can con and fool the employee into not signing up for unemployment insurance, though you have a right to those seven or eight thousand dollars worth of insurance (not welfare, not a poverty program or based on need, or taken from the taxpayers, but insurance that is paid by the employer so that you are not dumped out on your own without anything through no fault of your own.)