The Financial Crisis and Meltdown of 2008 – Do You Know Your Severance Rights on Layoff?

The ongoing financial crisis and meltdown of 2008 has a lot of people concerned about their financial future. Layoffs are happening now and are going to continue to happen. Employees in all industries, not just the financial markets industries, are looking to the left and looking to the right at their fellow employees and at themselves and wondering who is going to be next. The time to be concerned is now. Those slated for layoffs now or in the future need to know what the future holds for them. And one thing they need to be concerned about right now is their severance rights – what they are going to get in the form of payments from their employer when they are let go or fired. You may be surprised as to what those rights are.

Your Rights

I recently read an article on CFO.com entitled “Know Your Severance Rights and Risks”. The article is aimed at Wall Streeters (the ones that caused the problems in the first place) but they are applicable to all employees in the US and in general to all employees in Westernized nations. If you have an employment agreement which specifies severance terms you are OK as long as your company is able to make those payments (i.e. they are not going down the tubes). But not everybody is in that situation. Now if you don’t have anything in writing that’s a whole different story. The employment lawyers are saying, don’t assume anything. You might get something but don’t count on it.

Don’t Count On Your Company To Look After You

Some companies may offer some kind of severance in exchange for you agreeing to some kind of non-compete period. But that is up to the company. You can’t force them to offer it to you.

Many employees think that they are entitled to some kind of notice period when terminated without cause. But the federal Worker Adjustment and Retraining Notification Act and various state laws which cover the situation where there is a “mass layoff” or a “plant shutdown” only require 60 days notice or severance. Is that 60 days long enough for you to find alternative employment?

And don’t assume that just because someone else in your company at a similar level got severance that you will as well. And don’t assume that if you worked at the company longer that you will get more.

So what is the take-away from all this? Basically, if you are laid off or terminated, you have a very short (or non-existent) time horizon to do something about future cash flow. There will probably be minimal or no severance pay.

What can you do now to protect you and your family in the future?

1. Set aside savings enough to cover your expenses for 3 – 6 months (more if you can).

2. Have a Plan B.

Plan B

What is your Plan B? What is your fall back plan if this financial crisis hits you personally and you are laid off from your job? How will you handle this worse case scenario? Right now is the perfect time to build a network marketing or internet marketing business. When the economy is doing well and you are making good money, you may not have given starting your own business much thought. You are not the only one. It’s like when you have had a big dinner and you see food. You’re not really looking. But when times get tough, you and others are more receptive to alternatives and may actively look for business ideas.

Well, the current financial crisis and financial meltdown has created tough times. And the smart people are going to look for smart alternatives and never let a situation like we have today blind-side them again. If you haven’t ever thought about it seriously, maybe now would be a perfect time to investigate network marketing.

If you have never given network marketing serious thought in the past because of your perceptions that you have to chase your friends and relatives and that you would be banned from weddings and funerals, let me show you how you can use attraction marketing and Web 2.0 technologies to build an internet network marketing business in a professional way. And keep your friends.

C Doug Mah is an internet network marketing coach whose goal is to teach independent business owners how to use attraction marketing and Web 2.0+ technologies to grow their businesses profitably. Going beyond the old school techniques that are still being taught by some network marketing and MLM organizations, these techniques drive pre-qualified prospects to your business, allowing you to spend more time in business building and training instead of prospecting and recruiting.

If you are interested in learning more about internet network marketing please visit my blog.