Legal Question in Business Law in California

How much serverance pay do they have to provide

I have worked at the same business for over 30 years . I am 50 years old and now out of the blue(after being told that the company was acually going to expand and raises were on the way) the new owner of the company has decided to fold the business. We have never had any kind of insurance plans or retirement fund threw this company and now they are saying that they are going to give us only 1 week severance pay? Arnt they obigated to give us more than that? I would think that after 30 years we would bve intitled to something more! Is there anything we can do about this?


Asked on 5/18/05, 5:21 pm

1 Answer from Attorneys
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Re: How much serverance pay do they have to provide

Morally obligated, maybe, but not legally obligated unless there is a contract between the workers and the employer (either a collective bargaining contract or individual employment contracts).

Depending upon the size of the company, there may be an obligation to give more advance notice of the planned closure.

You are entitled to pay for any accrued vacation you haven't used.

I would suggest that you and your co-workers get together to discuss what to do. There's something fishy here; new owners don't usually fold the business they've just acquired. Talk to the former owner. Maybe consider getting the employees together to make an offer to buy the business and run it yourselves. After all, who is better prepared to make a success of it that the guys who've done the work for decades?

If you can't buy it on favorable terms, wait for it to shut down, then start your own company doing the same thing and serving the same customers. Just a thought; get further legal advice before trying any of these ideas.

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Answered on 5/18/05, 5:57 pm


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