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Jason
07-01-2003, 01:59 PM
Hello all,

I recently got laid off by my company which gave me 5 months of
severance. (Good company, no complaints other than being laid off).
The severance was 3 months plus 2 more for signing a release agreement.

I have this Mortgage Unemployment Insurance (aka, Involuntary
Unemployment Insurance), and they have been giving me the run around.
First, they had all these requirements for documents they "must" have.
Ie. The *application* for my loan. I asked why it had to be the
*application* and they just said, "because that's what we want, and
closing documents do not count." After digging up all the documents
they needed (I'm a pack rat, so HA on them!), they are now delaying
payments for 5 months due to the following line in the insuring agreement:

"Involuntary Unemployment does not include ... any period of time for
which You are receiving termination or severance pay ... "

They also list a bunch of other reasons, but those aren't applicable.
So my question is if this is legally correct. First off, I believe at
minimum, 2 months should not be included because I signed a release
agreement. Secondly, I received my severance as one lump sum on the day
I got laid off, so since I am no longer receiving severance pay, I
should not be penalized.

Can someone give me legal reasons that I am wrong or correct? I'd like
to come back at them saying, "By XXX court ruling, and by XXX law, you
are not allowed to delay payments." Or does anyone know a lawyer that
would take this case in Colorado? This is several thousands of dollars,
so depending on how much lawyer fees are, I might be willing to pay it.

Thanks!

Jason

Barry Gold
07-04-2003, 09:21 AM
Jason <zippy55513@yahoo.com> wrote:
[OP was laid off, received 3 months severance pay plus
2 months for signing a realease. OP has Mortgage
Unemployment Insurance. Insurance paper includes the
following:]
"Involuntary Unemployment does not include ... any period of time forwhich You are receiving termination or severance pay ... "They also list a bunch of other reasons, but those aren't applicable.So my question is if this is legally correct. First off, I believe atminimum, 2 months should not be included because I signed a releaseagreement. Secondly, I received my severance as one lump sum on the dayI got laid off, so since I am no longer receiving severance pay, Ishould not be penalized.

I can't give you a court ruling, but in California you would qualify
for unemployment insurance for those 5 months. I also received a
hefty severance package when I was laid off, called the Unemployment
office, and asked.

Beyond that, it might be worthwhile for you to see a real live lawyer.
If you are in the right, your lawyer will write them a letter telling
them to pay up, and it will probably carry more weight than anything
you can tell them.
--
I pledge allegiance to the Constitution of the United States of America, and
to the republic which it established, one nation from many peoples, promising
liberty and justice for all.

Stan Brown
07-04-2003, 09:21 AM
In article <agt3gv8c8759cjl028pfpr4e4a0olk181t@4ax.com> in
misc.legal.moderated, Jason <zippy55513@yahoo.com> wrote:
"Involuntary Unemployment does not include ... any period of time forwhich You are receiving termination or severance pay ... "They also list a bunch of other reasons, but those aren't applicable.So my question is if this is legally correct. First off, I believe atminimum, 2 months should not be included because I signed a releaseagreement. Secondly, I received my severance as one lump sum on the dayI got laid off, so since I am no longer receiving severance pay, Ishould not be penalized.Can someone give me legal reasons that I am wrong or correct?

It says "... any period of time FOR WHICH you are receiving ...",
not "during which". In other words, if you are paid up front an
amount that is supposed to cover a future time, you are being paid
for that future time and are not entitled to collect.

The two months of /douceur/ for signing the release agreement
doesn't qualify as severance pay in my opinion, and therefore I
don't think you are being paid for those two months. (My opinion
proves nothing at all; see disclaimer in sig.) You should have
paperwork from your former employer: is the two months included as
severance pay? Can you gt a letter from them saying it's in
consideration of a release agreement and is not part of severance?

I don't think you're entitled to the three months; if you want to d
collect the two months you may have to sue. Small claims court seems
a reasonable option. Whether you'll prevail is anybody's guess, but
it won't cost you much to find out.

--
I am not a lawyer; this is not legal advice. When you read anything
legal on the net, always verify it on your own, in light of your
particular circumstances. You may also need to consult a lawyer.

Stan Brown, Oak Road Systems, Cortland County, New York, USA
http://OakRoadSystems.com

Stan Brown
07-18-2003, 11:59 AM
In article <981ehvo7n1h30nibd6p4k8elp2lqg79rvd@4ax.com> in
misc.legal.moderated, Jason <zippy55513@yahoo.com> wrote:
Stan Brown <the_stan_brown@fastmail.fm> wrote in messagenews:<rlnlgv4v2cmv9s1cu0gfsv7b9ng2ufiag0@4ax.com>...
Why is this unfair, in your opinion? Unemployment insurance is intended to replace (a part of) your lost income from losing your job. During the three months covered by your severance pay, you haven't lost any job income.Now you are saying that because I took a job at a better company, Ishould not get unemployment benefits.

No, I said that because you were being paid three months severance
by your old company, you should not get unemployment pay for those
three months.

I say again, why do you think that is unfair? Why should you be
entitled to get _more_ money for not working than you got for
working?

In addition, as far as I understand it, unemployment insurance is paidby the employer, before the employee is laid off. It works similar tohow car insurance works.

I don't think that's a very good analogy, but let's accept it for
the purpose of argument. If you are in a car accident, and the
person who hit you pays to restore your car, would you think it was
unfair if your insurance company did not _also_ pay you money for
the same repairs?

--
I am not a lawyer; this is not legal advice. When you read anything
legal on the net, always verify it on your own, in light of your
particular circumstances. You may also need to consult a lawyer.

Stan Brown, Oak Road Systems, Cortland County, New York, USA
http://OakRoadSystems.com

David S Chesler
07-27-2003, 02:20 PM
"Stuart O. Bronstein" wrote:
There's your problem. Unemployment is not supposed to replace income. It's to act as emergency funds so you're not thrown out on the street before you can get another job.

Then why isn't is needs-tested?

If you want insurance to replace your salary if you are laid off, get it yourself - it will be very expensive. A lot more expensive than the withholding that is taken for unemployment.

This discussion is comparing apples and oranges. You don't have a
choice about Unemployment "Insurance". Both enrollement and the
terms are dictated unilaterally by "the government". (Disclaimers
for the choices of the political process, and shopping for states
with different programs.)

But within the context of this program, about which the worker had
no choice, there are questions as to what it means to be "unemployed".
And I stand with those who say "If you're not working, you're unemployed,
even if while you were working you earned a severance package which is
only payable upon getting laid off, and which is calculated in terms
of a time period and a rate of pay which is, or which is based on,
your prior salary."

Sometimes you step in crap and wind up smelling like a rose, other
times you wind up smelling like crap, and other times you wipe it
off. Sometimes you get laid off and you end up in a better,
higher-paying job; sometimes you're out of work and not getting
paid for a while, putting a serious dent in your career pather;
other times you're out of work for a few weeks but pretty soon
you're back in the saddle again. You never asked for Unemployment
Insurance to make you whole, but you expect it to meet its advertised
terms, along the lines of 50% of your salary, up to a cap, for up
to some period like 6 or 9 months, while you're involuntarily out
of work and looking for work.
--
- David Chesler <chesler@post.harvard.edu>
Iacta alea est

Brian D'Souza
07-30-2003, 08:13 AM
David S Chesler <chesler@post.harvard.edu> wrote in message
news:<u9g8iv4bquochuum81f78sidu4pogksteg@4ax.com>...
"Stuart O. Bronstein" wrote:
There's your problem. Unemployment is not supposed to replace income. It's to act as emergency funds so you're not thrown out on the street before you can get another job. Then why isn't is needs-tested?
If you want insurance to replace your salary if you are laid off, get it yourself - it will be very expensive. A lot more expensive than the withholding that is taken for unemployment. This discussion is comparing apples and oranges. You don't have a choice about Unemployment "Insurance". Both enrollement and the terms are dictated unilaterally by "the government". (Disclaimers for the choices of the political process, and shopping for states with different programs.)

David,

If you go back and read the original post, you will see that he is not
talking about State Unemployment Insurance or Benefits. He purchased
Mortgage Unemployment Insurance, the kind that almost every mortgage
banker and broker offers you, and almost all wise persons decline to
purchase because the exclusions preclude your receiving payment in
almost all circumstances. He is bound by the conditions of the
insurance contract. Sounds like the insurance contract specifically
excludes the OP's circumstances. Rules for State UI vary and exclude
the severace period in many cases, based on the definitions in the
statute or regulation. Private insurance is governed by the insurance
contract, and of course state law. I doubt that there is a state law
that defines when an insurance contract can preclude Mortgage
Unemployment Insurance payments, due to the insured receiving
severance pay.

So all this cute stuff about what UI is about is beside the point.

Cheers!

Brian

David S Chesler
08-04-2003, 10:33 AM
bdsouza@yahoo.com (Brian D'Souza) wrote in message
news:<4vnfiv0ccde1vdvn2odh6lv9l6h2p6aje0@4ax.com>...
Then why isn't is needs-tested?
If you want insurance to replace your salary if you are laid off, get it yourself - it will be very expensive. A lot more expensive than the withholding that is taken for unemployment. This discussion is comparing apples and oranges. You don't have a choice about Unemployment "Insurance". If you go back and read the original post, you will see that he is not talking about State Unemployment Insurance or Benefits. He purchased Mortgage Unemployment Insurance, the kind that almost every mortgage banker and broker offers you, and almost all wise persons decline to purchase because the exclusions preclude your receiving payment in almost all circumstances.

Gotcha, although we seem to have topic-drifted into the state
program called Unemployment Insurance right from the first reply.

OP's policy said
>> "Involuntary Unemployment does not include ... any period of time for>> which You are receiving termination or severance pay ... "

And IMHO a lot hinges on "for". A less ambiguous wording would
be "during", with a secondary explanation "Any severance pay, or
similar payment from the employer to the employee payable in the
case of involuntary termination [.] shall be considered to be
salary continuation, at the last rate of pay paid[+], for a period
of time equivalent to the amount of time it would have taken for
the erstwhile employee to have earned that pay if he had not been
terminated."

They might insert here "Other than for cause" or other words
to mean layoffs, RIFs, redundancies, and so forth;
[.] They might insert here "Determined by multiplying a period
of time by a rate of pay"[^]
[+] Or if they want to be mean, at minimum wage :-(
[^] IANAL. But I am a SW Engineer, and a lot of what I do is
defining the rules for "When is a this a member of that class?"
Here I'm trying to capture the essence of "layoff" and "severance
pay". Just because you have to roll-out your 401(k) when you
leave the company doesn't make it severance pay in almost
everybody's eyes.

When is any pay earned? If it's on a cash basis, then the rate
of pay is several million dollars a year every Friday afternoon,
and zero the rest of the time. Similarly, the severance pay
was _earned_ during the time before the layoff. (Some companies
make it very clear: You will be laid off in three months. If
you stay until the end, training your replacement, you will get
this severance package. And if you sign this release, you will
get a bigger package.)

He is bound by the conditions of the insurance contract. Sounds like the insurance contract specifically excludes the OP's circumstances. Rules for State UI vary and exclude the severace period in many cases, based on the definitions in the statute or regulation. Private insurance is governed by the insurance contract, and of course state law. I doubt that there is a state law that defines when an insurance contract can preclude Mortgage Unemployment Insurance payments, due to the insured receiving severance pay.

So then it comes down to interpreting the contract. And
certainly not pondering the whys and wherefores.

--
- David Chesler <chesler@post.harvard.edu>
Iacta alea est

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