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The state of Tennessee does not require employers to offer severance pay. Employers who offer this benefit must always comply with their employment contracts or established policy on severance pay.
Employers may legally terminate an employee at any time for any reason, or for no reason without incurring legal liability. However, an employer may not discriminate against any employee on the basis of the employee's race, sex, age, religion, color, national origin, or disability.
Severance pay is often granted to employees upon termination of employment. It is usually based on length of employment for which an employee is eligible upon termination. There is no requirement in the Fair Labor Standards Act (FLSA) for severance pay.
Rule 0800-09-01-. 02 of the Rules and Regulations of the Tennessee Employment Security Law, requires all employers to furnish each separated employee with a Separation Notice, LB-0489, within 24 hours of the employee's separation from employment.
Wages in lieu of notice and severance pay affect UI UI benefits will also be denied to any claimant for any week in which he received a severance package that includes an equivalent amount of salary the employee would have received if he were working during that week.
Finally, an employer must pay any employee who quits or is discharged his or her final wages within 21 days of the termination date or the next regularly scheduled payday, whichever occurs later. Why should you care? Because the statutory penalties can add up quickly.
Employers may legally terminate an employee at any time for any reason, or for no reason without incurring legal liability. However, an employer may not discriminate against any employee on the basis of the employee's race, sex, age, religion, color, national origin, or disability.
As Tennessee is an at-will employment state, your employer is not required by Tennessee employment law to offer you severance. The company does so because the terms of the agreement are in some way beneficial to them?but you have the right to negotiate for your best interest as well.