Tag Archives: severance

Settling a workers’ compensation and wrongful termination case at the same time

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Many employers want to settle all employment-related claims when they settle a workers’ compensation case

Clients often ask me, “If I settle my workers’ compensation case, can I still sue my employer for wrongful termination?” My answer is almost always yes. But for one unfortunate employee in Louisiana, it appears settling their workers’ compensation case may have doomed their wrongful termination case.

A federal district court in Louisiana held that a worker who settled their workers’ compensation case with a release that released all claims arising from their work injury was deemed to have settled their wrongful termination case under various civil rights laws.

The Louisiana decision raised the ire of some employee-side attorneys. Workers’ compensation laws and civil rights laws provide different remedies for different harms. A Minnesota court recently used this fundamental tenet of law to hold that a disability discrimination claim under their state’s civil rights laws was not barred by the exclusive remedy provision of their state’s workers’ compensation act.

But as a practical matter, some employers like to settle all claims arising out of the employment relationship when they settle a workers’ compensation case. In these cases there is usually consideration, or seperate amounts, to settle the workers’ compensation claim and the employment law claim. Sometimes this can be advantageous for a client. I am not sure of how the release was structured in the Louisiana case, but here is how I structure so-called global releases. In short, you need two releases: one for the workers’ compensation claim and one for the wrongful termination case.

Settling the workers’ compensation case

I wrote earlier about the so-called exclusive remedy of workers’ compensation. In Nebraska, that exclusive remedy also means the workers’ compensation court has limited jurisdiction. Nebraska courts have stated repeatedly that the Nebraska Workers’ Compensation Court can not adjudicate employment law cases because they are a court of limited jurisdiction. Neb. Rev. Stat. §48-139 gives the court jurisdiction over workers’ compensation settlements. 48-139 also dictates the language of workers’ compensation settlements, states when settlements must be approved by the court and mandates the filing of settlement papers with the court. In short, if the Nebraska Workers’ Compensation Court does not have jurisdiction to hear a wrongful termination or discrimination case, any settlements in that court should not effect any wrongful termination case or discrimination case.

Settling the wrongful termination or discrimination case

A settlement agreement in a wrongful termination case is a different document. Usually there is no requirement that it be filed or approved by a court. These agreements are often synonymous with severance agreements and oftentimes included language required by the Older Workers’ Benefit Protection Act if the employee is over 40 years old.

Settlement agreements in employment cases usually also talk mention tax liability. Tax liability is usually not mentioned in a workers’ compensation settlement as workers’ compensation benefits are almost never taxed. But settlement proceeds in a wrongful termination or discrimination case are usually taxable and those agreements should include some discussion of tax liability.

Sometimes employers will want a resignation as a condition of paying a settlement to an injured employee. If the employee is still working, that provision can be a deal breaker. But for an employee who has been terminated the extra money for a wrongful termination claim can be beneficial. Settling all claims at once may also help an employee minimize taxes by apportioning the majority of the value of the severance or employmennt law settlement into the non-taxable workers’ compensation settlement.

The offices of Rehm, Bennett & Moore, which also sponsors the Trucker Lawyers website, are located in Lincoln and Omaha, Nebraska. Five attorneys represent plaintiffs in workers’ compensation, personal injury, employment and Social Security disability claims. The firm’s lawyers have combined experience of more than 95 years of practice representing injured workers and truck drivers in Nebraska, Iowa and other states with Nebraska and Iowa jurisdiction. The lawyers regularly represent hurt truck drivers and often sue Crete Carrier Corporation, K&B Trucking, Werner Enterprises, UPS, and FedEx. Lawyers in the firm hold licenses in Nebraska and Iowa and are active in groups such as the College of Workers’ Compensation Lawyers, Workers' Injury Law & Advocacy Group (WILG), American Association for Justice (AAJ), the Nebraska Association of Trial Attorneys (NATA), and the American Board of Trial Advocates (ABOTA). We have the knowledge, experience and toughness to win rightful compensation for people who have been injured or mistreated.

This entry was posted in employment law, Nebraska, Workers Compensation and tagged , , , , , .

Offered Severance? Questions for Hurt Workers to Ask

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Getting hurt at work and getting fired are two of the most stressful occurrences for an employee. Oftentimes, these stressors are combined when an injured worker receives a severance agreement. This article provides five questions an injured worker who gets a severance agreement should ask:

  1. Does signing a severance agreement settle your workers’ compensation claim? Connecticut courts recently ruled that a severance agreement does not release a workers compensation claim. However, Florida courts have held the opposite. My state of Nebraska generally does not allow workers’ comp claims to be released in severance agreements. Consult with a lawyer in your state to get a good answer. Most lawyers who do workers’ compensation work on a contingent fee basis are generally happy to spend a reasonable amount of time answering questions from injured workers faced with a severance agreement. Don’t let fear of cost deter you from contacting a lawyer.
  2. What does your state’s workers’ compensation act cover? Some workers’ compensation statutes, like Ohio and Texas, also cover retaliatory discharge cases. My state of Nebraska makes wrongful discharge a separate civil claim. The consequence of that for injured workers in Nebraska and other states with so-called “common law” retaliatory discharge causes of action: a severance agreement would close out that case along with most other claims under fair employment statutes like the ADA, FMLA and Title VII. If you are in a state where retaliatory discharge is covered under your workers’ comp statute, then that case may not be released in a severance agreement in a comp claim if your state doesn’t allow comp claims to be settled in severance agreements.
  3. What are your chances for receiving unemployment benefits?  Finding out your chances of receiving unemployment is critical – again, especially if you are forced to choose between severance and workers’ compensation. The key questions to ask for eligibility for unemployment are 1) whether you earned enough wages to be covered 2) whether you quit without good cause or were fired for misconduct and 3) whether you are able and available for work. Of course, if you have an ongoing workers’ compensation claim, the fourth question is how receiving unemployment would affect your workers’ compensation claim. If you chose to negotiate your severance agreement, either by yourself or with a lawyer, try to include a provision where the employer chooses not to oppose your application for unemployment benefits.
  4. Do you get benefits like vacation pay, even if you don’t sign a severance agreement? In some states, including my state of Nebraska, an employee should receive vacation pay or paid time off regardless of whether they sign a severance agreement or not. Again, if you live in a state where an employer can release a workers’ compensation claim through a severance agreement, your eligibility for vacation pay along with unemployment benefits should help you decide whether it make sense for you economically to pursue your workers’ compensation claim if you have to pick between severance and workers’ compensation. This also holds true for severance agreements in general if you an employer is asking to you to release a strong fair-employment claim for a low-ball severance amount.
  5. Did you contact a lawyer who is knowledgeable about workers’ compensation? This is a critical period and critical especially if you live in a state where comp claims can be released by severance agreements. An experienced workers’ comp lawyer can value your comp claim. Some ways to evaluate whether a workers’ compensation lawyer is knowledge is to check whether they are a member of the Workers’ Injury Law & Advocacy Group (WILG). Another is to see if you can search them on your state’s workers’ compensation court website or through free legal research services like FindLaw and Google Scholar. A knowledgeable workers’ compensation lawyer in your state should also be able questions 1-4.

The offices of Rehm, Bennett & Moore, which also sponsors the Trucker Lawyers website, are located in Lincoln and Omaha, Nebraska. Five attorneys represent plaintiffs in workers’ compensation, personal injury, employment and Social Security disability claims. The firm’s lawyers have combined experience of more than 95 years of practice representing injured workers and truck drivers in Nebraska, Iowa and other states with Nebraska and Iowa jurisdiction. The lawyers regularly represent hurt truck drivers and often sue Crete Carrier Corporation, K&B Trucking, Werner Enterprises, UPS, and FedEx. Lawyers in the firm hold licenses in Nebraska and Iowa and are active in groups such as the College of Workers’ Compensation Lawyers, Workers' Injury Law & Advocacy Group (WILG), American Association for Justice (AAJ), the Nebraska Association of Trial Attorneys (NATA), and the American Board of Trial Advocates (ABOTA). We have the knowledge, experience and toughness to win rightful compensation for people who have been injured or mistreated.

This entry was posted in employment law, getting fired, Workers' Compensation and tagged , , , , , , , .

What Football Can Teach White-collar Employees About Layoffs, Severance

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With football season upon us, I would like to use football to explain some common situations that employees face.

I get a lot of calls from white-collar professionals who have long careers with a company but then are laid off a few months after a new boss is hired. This happens a lot in football when a general manager/athletic director replaces a head coach and the head coach fires the previous coach’s assistant coaches. White-collar employees in middle-management positions are essentially the equivalents of assistant coaches in football. In the world of football, it is assumed that a new head coach can bring in his new assistants. The same assumption holds true in the business world.

Assistant coaches are oftentimes “bought out” of their employment contracts. Sometimes white-collar professionals have employment contracts, but more often than not they do not. Sometimes professionals are offered severance agreements, but unless there is an employment contract, that severance is not a buyout. Employers are also under no obligation to offer severance. If severance is offered, that doesn’t necessarily mean that an employer wrongfully terminated the employee.

Of course, no employee can be terminated because of age, disability, sex, race, nationality, or in retaliation for engaging in a protected activity like filing for workers’ compensation or filing with OSHA. But even if there is some appearance of wrongful motivation on behalf of the employer, the employer can still defeat a potential lawsuit if they have a legitimate business reason for terminating the employee. Going back to a football analogy, if the new head coach wants to switch an offensive or defensive scheme, they have the right to hire the person they choose. The fact the new hire might be less effective than the old hire is not a decision that a court will second guess in a wrongful termination. Sure, if there is something else wrongful going on, it is something a court or a jury could consider, but in a case where there is a recent change in management, employees will have difficult time overcoming the assumption that the new boss just wants to “put in their team.”

The offices of Rehm, Bennett & Moore, which also sponsors the Trucker Lawyers website, are located in Lincoln and Omaha, Nebraska. Five attorneys represent plaintiffs in workers’ compensation, personal injury, employment and Social Security disability claims. The firm’s lawyers have combined experience of more than 95 years of practice representing injured workers and truck drivers in Nebraska, Iowa and other states with Nebraska and Iowa jurisdiction. The lawyers regularly represent hurt truck drivers and often sue Crete Carrier Corporation, K&B Trucking, Werner Enterprises, UPS, and FedEx. Lawyers in the firm hold licenses in Nebraska and Iowa and are active in groups such as the College of Workers’ Compensation Lawyers, Workers' Injury Law & Advocacy Group (WILG), American Association for Justice (AAJ), the Nebraska Association of Trial Attorneys (NATA), and the American Board of Trial Advocates (ABOTA). We have the knowledge, experience and toughness to win rightful compensation for people who have been injured or mistreated.

This entry was posted in employment law, getting fired and tagged , , , , .