Does severance pay affect eligibility for unemployment benefits? (2025 Details)

If an employee is involuntarily separated from work (e.g. fired not for cause; lay off); he or she is eligible for unemployment insurance his or her employment ends. If an employee receives severance and that severance is paid over time, or if that person signs a voluntary leave document that could negatively impact his or her eligibility for unemployment insurance.

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Unemployment Benefits After Being Fired

In some cases, an employee can collect unemployment after being fired. However, unemployment benefits are not available in all cases and sometimes being fired renders an employee ineligible for benefits. Individual state eligibility guidelines determine when an employee can receive unemployment and these guidelines may differ slightly from one jurisdiction to the next.

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Can You Be Fired for Medical Reasons?

You can get fired while out sick but you cannot be terminated because of medical leave or because of the underlying disability. An employee may be terminated for any reason that is not illegal, at any time, without notice.

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Firing Employees with a Drinking Problem

Alcoholism is the single largest and most economically destructive addiction in America as an estimated seventeen million Americans struggle with some phase of alcohol addiction at a cost to industry of $186[1] billion each year. Federal and state law govern at what point an employer may terminate an alcoholic employee, and any employer faced with the negative affects of alcohol in the workplace should consult an experienced attorney before taking any action.

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What is wrongful termination and how can I prove it?

Wrongful termination may occur in circumstances where an employer does not follow its own policy and procedures for dismissing an employee. This is otherwise known as an employer breaching an implied contract between the employer and employee. An implied contract is a contract in which the terms have not been specifically agreed upon between the employer and employee.

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Enforceability of Non-Compete Work Agreements

If an employee signs a non-compete work agreement, he or she can be held to its terms, at least up to a limit. Non-competition agreements are only enforceable to the extent they are reasonable in both geographic scope and time duration. Unreasonable agreements will either not be enforced or will reduced by the courts to a more reasonable level if challenged (called “blue penciling”).

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