Many people lost their jobs in the wake of the U.S. economic meltdown in 2008 and 2009. In many respects, the country still has not recovered -- but we are certainly on our way, as there seem to be some positive signs.
During this uncertain economic time, the federal government approved a massive bailout package that few people are likely to forget. The funds helped numerous companies -- and most notably banks -- stay afloat during a very difficult time.
Whether you agree or disagree with the decision to bail out these institutions, there was a significant impact on employees as well, and the affects struck people on either side of the debate.
In particular, there is a term called "golden parachute" payments that some companies tried to apply to people who were laid off or fired.
For example, there is a case out of St. Louis where a banker was fired by Reliance Bank. He was an executive there, and he had one year remaining on his employment contract. He was owed more than $300,000 in compensation; but Reliance claimed his salary was a "golden parachute" payment, and thus did not pay him since the Troubled Asset Relief Program bans "golden parachutes."
He is now suing his former employers for not giving him back pay or benefits for his remaining contract. It is an important reminder about employment contracts; namely that, no matter how convincing your employer or HR department may sound, the contract grants you some rights and protections too. Upholding those rights in the wake of a firing is critical, and you should consult an attorney if this unfortunate situation arises.
Source: St. Louis Today, "Banker sues Reliance Bank over pay," Lisa Brown, Feb. 8, 2013
- Please visit our Houston employment contract page to learn more.