A few months ago, I was hired by an IT consulting agency for a big project involving upgrading every computer owned by a very large company. The consulting agency lost the contract due to a dispute. I was, and still am, considered to be a full time employee of the consulting agency. However, they do not have any other work for me for the time being.
They were quite impressed with my work, but I still lost the job, because they lost the contract. I was part of a team of ten people on this project. We were all fired because of the dispute. None of us did anything wrong to warrant getting fired. My immediate boss was the one of the managers for this project, and he was fired too.
They are trying to find another project for me, but I don’t know how long that will take. How can I make sure to get paid severance? My father told me that if his company lays him off, they have to give him 12 weeks worth of full pay and benefits. (He’s been working at a big insurance company for 10 years) Is severance required by law, or is that more likely to be the policy of his company?
Severance pay is either voluntarily provided by a company or as part of a union contract. It’s not required by law in the US.
Severance is something your company either offers or it doesn’t. There isn’t any requirement that they offer it, and its highly unlikely that they will in a consulting agency. So, you probably won’t get severance.
US employers who are covered by the WARN Act need to give 60 days advance notice of plant closings or mass layoffs. An employer who does not give the notice may be liable for up to 60 days pay and benefits to the affected workers.
But in general, there is no requirement for severance pay, at least on a national level.
Many years ago I worked for an IT consulting company that hired its employees out to various US government agencies. . At one point they lost their contract with one of those agencies, and those of us working on that contract received an email at 8AM informing us to stop working as of 10AM and the company would get back to us if and when they got the contract reinstated. That never happened.
Fortunately for me, I was able to get a job contracting for another company within two weeks. Others may not have been so fortunate.
That’s the thing about working for a consulting company. Part of the reason why you get jobs in the first place (as opposed to the client company hiring permanent staff to perform the task) is that you’re an “easy in, easy out” asset.
You don’t get severance when you still are employed, even if you are not working and not getting paid. You did not lose a job. The company you work for lost the contract. You are still listed on the consulting firms books as their employee. You just are not working.
Check into your states unemployment. In some cases even though you are still employed you can file for unemployment do to loss of income. I don’t know what your work history was prior to this gig, that is also going to be a factor for unemployment.
In many contract firms, they have a situation where they put people “on the bench” which means even if they don’t have work for them they pay them a salary for a limited period of time until they find them work. This or severance would have to be spelled out in your employee agreement and/or the company policy manual. Otherwise you don’t get any sort of severance.