You Just Got Fired. Now What?

Getting fired from a job is one of the most stressful and difficult experiences a person can endure.  Regardless of the circumstances underlying the termination, all employees should consider various issues once they’ve been terminated, to ensure that they understand their legal rights and that their employer meets its legal obligations.

Here are five questions to ask yourself–or to explore with an employment attorney—if you’ve been terminated:

Were my employer’s reasons for terminating me unlawful?

Generally, California employees are presumed to be employed “at-will”–meaning, the employer has a right to terminate an employee’s employment for any reason or no reason, with or without notice. Cal. Labor Code § 2922.  The exception to this rule is that an employer may not terminate an employee for a reason that is otherwise prohibited by law–for example, because of an employee’s protected status (such as race, national origin, religion, gender or sexual orientation, to name a few) or in retaliation for engaging in protected activity under the law (such as whistleblowing or making a sexual harassment complaint).  An employer also may not terminate an employee in an effort to prevent the employee from exercising a legal right to take a leave of absence, such as family and medical leave under the Family and Medical Leave Act (FMLA) or California Family Rights Act (CFRA) or a medical leave as a disability accommodation.

An employer who terminates an employee for an unlawful reason is unlikely to be up front about it. Most employees who believe that their employer terminated them illegally must come up with circumstantial evidence showing that the employer’s stated reason was pretextual, and that the employer in fact terminated the employee because of an illegal reason.  Such circumstantial evidence could include general comments by the supervisor or manager involved in the termination that suggest a bias or animus against members of the employee’s protected class.  In addition, an employee may be able to establish discrimination by showing that the employer treated him or her differently with respect to a workplace rule.  For example, evidence that an employer terminated an African-American employee for violating a workplace rule and did not terminate non-African-American employees who violated the same rule under similar circumstances could support a race discrimination claim.  Consultation with an experienced employment lawyer can help terminated employees determine the likelihood of obtaining the necessary evidence to successfully pursue a termination claim.   (See this recent post regarding proving discrimination claims.)

Did my employer pay me everything it owes me?

California law requires employers to pay employees all wages owed at the time of termination. Cal. Labor Code § 201.  This includes not only the employee’s salary or wages up to the termination date, but also all of the employee’s accrued and unused vacation or paid time off (PTO). Cal. Labor Code § 227.3.  For commission employees, employers must also upon termination pay all earned commissions that can be reasonably calculated at the time of termination.  Cal. Labor Code § 201.

In addition to all earned wages and commissions, employers must reimburse terminated employees for all expenses incurred prior to the termination in the course and scope of their employment. Cal. Labor Code § 2802.  Employees should notify their employers of any unpaid expenses at the time of termination and provide any necessary documentation for such expenses.  In the event the employer still does not pay and forces the employee to initiate formal action to recover reimbursement, the employee is entitled to recover his or her attorneys’ fees in addition to the unpaid business expenses. Cal. Labor Code § 2802(c).

Did my employer pay me on time?

If an employer willfully fails to pay a terminated employee all wages–including accrued vacation and earned commissions–at the time of termination, the employee may also be entitled to waiting time penalties. Waiting time penalties accrue in an amount equal to the employee’s daily rate of pay multiplied by the number of days the employee was not paid, up to 30 days. Cal. Labor Code § 203.

A willful failure to pay wages within the meaning of Labor Code Section 203 occurs when an employer intentionally fails to pay wages to an employee when those wages are due. However, the employee may not recover waiting time penalties in the event that a good faith dispute exists as to whether the employee is entitled to the claimed wages. Cal. Code Regs., Title 8, § 13520.  In order to establish the existence of a good faith dispute, the employer must have a defense to the unpaid wage claim that, if successful, would preclude any recovery on the part of the employee. Id.  The fact that the employer’s defense is ultimately unsuccessful does not necessarily preclude a finding that a good faith dispute existed, but there is no good faith dispute where the employer’s defense is unsupported by any evidence, or is unreasonable or presented in bad faith. Id.

Am I entitled to severance pay? 

Unless an employer has an existing policy that promises to provide severance pay upon termination, a terminated employee generally has no right to such pay. An employer offering a terminated employee severance pay will likely require the employee to sign a general release before receiving the severance, which will waive any and all legal claims arising out of the employment relationship–whether or not the claims have anything to do with the reasons for the employee’s termination.  Employees should not sign any such releases on the spot–and employers should not require them to do so or risk invalidating the release as involuntary–and should consider having an employment attorney review the overall circumstances involved in the employment and termination, as well as the agreement itself before signing.

An experienced employment attorney can help analyze whether the employee has any potential legal claims arising out of the employment or termination, such that it may not be in the employee’s best interest to sign an agreement waiving those claims. In addition, an employment attorney should review the agreement to determine whether it contains required language to effectively waive certain claims.  For example, to obtain a valid waiver of an age discrimination claim under the federal Age Discrimination in Employment Act (ADEA), the release agreement must refer specifically to ADEA claims, must contain a statement advising the employee that he or she has a right to consult with an attorney, and must provide 21 days to consider the agreement before signing (45 days if the employee is laid off along with other employees) and seven days to revoke the ADEA waiver once signed.  See Older Workers Benefit Protection Act, § 201, 104 Stat. 983, 29 U.S.C. § 626(f); Oubre v. Entergy Operations, Inc., 522 U.S. 422 (1998).

Finally, an employment attorney can advise the employee as to his or her rights and obligations upon signing a severance agreement. For example, the severance agreement may contain non-solicitation or non-compete clauses that may or may not be enforceable under California law.  In addition, the agreement may impose obligations on the employee regarding the employer’s confidential or proprietary business information, which the employee must understand to avoid an inadvertent violation of those obligations.

Am I eligible for unemployment benefits?

Many people mistakenly believe that they cannot collect unemployment benefits unless they lose their job as part of a layoff or reduction in force. However, California employees are eligible for unemployment benefits even if they are fired so long as they were not terminated for misconduct.  The California Supreme Court recently confirmed that misconduct under the Unemployment Insurance Code does not include “mere inefficiency, unsatisfactory conduct, failure in good performance as the result of inability or incapacity, inadvertencies or ordinary negligence in isolated instances, or good faith errors in judgment or discretion.” Paratransit, Inc. v. Unemployment Ins. Appeals Board, (July 3, 2014).  This means that an employee can receive unemployment benefits even if he or she is terminated for acknowledged performance reasons or for violating certain types of employer policies.

Contact An Attorney

Rukin Hyland is one of the leading employment law firms in the San Francisco Bay Area. Our firm has helped employees across California to recover compensation, benefits and professional standing resulting from a wrongful termination lawsuit.

If you feel you have been wrongfully terminated and want to discuss your concerns with a lawyer, contact our employee rights law firm online or call 415-421-1800. Free phone consultations are available.

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