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Nevada unemployment & treatment of severance pay

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  • Nevada unemployment & treatment of severance pay

    I was recently laid off. My employer offered me a lump sum payment in return for signing a non-compete, non-disparagement, non-disclosure, and waiver of claim to earned but unpaid commissions. He called it 'severance pay'. I applied for unemployment online and got a message to call DETR regarding an 'issue' on my claim. When I called, they said that because I received severance pay, it would be divided by my weekly pay and used as an offset and I would receive no benefits for 12 weeks.

    NRS 612.420 states: "Receipt of wages in lieu of notice; severance pay. A person is disqualified for benefits for any week with respect to which he receives either wages in lieu of notice or severance pay"

    I am not sure how DETR can legitimately spread lump sum payments over several periods based on the wording of that section, but apparently that's what they are doing. NV is not very transparent in posting their internal bulletins and regulatory decisions online, so I haven't been able to find out much more than what NRS says about it.

    Any ideas? From speaking to the representative today it seems certain that I will have to appeal this, am I destined to lose it, or do you think I might have a chance to win.

  • #2
    per the DETR website

    Do I need to report vacation or severance pay.

    You must contact the claims center and speak with a representative. Nevada law does not allow payment of unemployment for any time period covered by employer-paid vacation pay, severance pay or wages paid in lieu of a notice of layoff.

    It seems you would not get paid for any period of time your severance pay would cover - apparently it covers 12 weeks of wages.

    It's up to you if you want to try an appeal though - it doesn't cost anything. However, it looks like they are correctly following their procedure.
    Too often we underestimate the power of a touch, a smile, a kind word, a listening ear, an honest compliment, or the smallest act of caring, all of which have the potential to turn a life around. Leo Buscaglia

    Live in peace with animals. Animals bring love to our hearts and warmth to our souls.

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    • #3
      The reason the 12 weeks came up was because the employment office representative divided the lump sum payment by my weekly wage and said it will be an offset to unemployment for that long. My employer never described it as 12 weeks severance pay, in the agreement I signed it merely states a dollar amount.

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      • #4
        However, the UI office can consider the severance as income ("wages") for 12 weeks before starting your unemployment ins. benefits.
        Too often we underestimate the power of a touch, a smile, a kind word, a listening ear, an honest compliment, or the smallest act of caring, all of which have the potential to turn a life around. Leo Buscaglia

        Live in peace with animals. Animals bring love to our hearts and warmth to our souls.

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        • #5
          Originally posted by Betty3 View Post
          However, the UI office can consider the severance as income ("wages") for 12 weeks before starting your unemployment ins. benefits.
          And they obviously have. This is not uncommon among the states. The idea is that the severance pay is replacing earned wages for a period of time; the fact that it is paid in a lump sum is irrelevant.
          I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

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          • #6
            Agree that many states handle severance pay like this.
            Too often we underestimate the power of a touch, a smile, a kind word, a listening ear, an honest compliment, or the smallest act of caring, all of which have the potential to turn a life around. Leo Buscaglia

            Live in peace with animals. Animals bring love to our hearts and warmth to our souls.

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            • #7
              I just wanted to provide an update on this situation. The adjudicator spoke to my employer who verified that the money I received was not severance or vacation pay, but was part of a settlement agreement to relieve him of any liability for future sales commissions. He said that because of that he is calling it a 'bonus' and I am only ineligible for unemployment in the week that I received it.

              Thanks for your input into this, I appreciate it

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              • #8
                Well, there ya go! Semantics ARE important.

                Congrats!
                I don't respond to Private Messages unless the moderator specifically refers you to me for that purpose. Thank you.

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                • #9
                  That's great!
                  Too often we underestimate the power of a touch, a smile, a kind word, a listening ear, an honest compliment, or the smallest act of caring, all of which have the potential to turn a life around. Leo Buscaglia

                  Live in peace with animals. Animals bring love to our hearts and warmth to our souls.

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                  • #10
                    2sleepy you didnt happen to work in the casino business (black gaming) did you, because i to had the same thing happen to me and i have not recieved any benefits since may 20th

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