A. Fired to Deny Accrued Benefits

The law obligates employers to deal in good faith with longtime employees. If you are fired just before you are supposed to receive anticipated benefits such as an earned bonus, vested stock option rights, accrued pension, profit sharing, or commissions due, consult a lawyer immediately. However, if an employer fires you for a lawful reason, that is, for cause, the fact you are about to become eligible for a substantial benefit may not make the firing illegal.

Counsel Comments:The duty of employers to act in good faith and deal fairly applies generally to cases where an employee has been working for the company for many years or where an employee is fired just before she is supposed to receive anticipated financial benefits. For example, in one case, a salesperson with 40 years of service claimed he was fired so his company could avoid paying commission otherwise due on a $5 million sale. The court agreed even though he had been hired at will. He was awarded commissions for the sale, notwithstanding the firing.

Another employee was fired after working 14 years without a written contract or job security. The court ruled that the main reason for the sudden discharge was to deprive her of the vesting of valuable pension benefits commencing several months into her fifteenth year of service.

Tip:If you are fired at the end of the year and are denied a year-end bonus or other benefits about to vest in the following year, consult a lawyer immediately to enforce your rights. Pension or stock option benefits about to vest within six months to a year of a firing often can be obtained via negotiations. For a bonus, a stronger claim can be made if you are fired within three months of the expected payment date. Sometimes a company will agree to keep you on unpaid leave status during the appropriate period as a way of qualifying. Speak to your lawyer about this negotiating strategy for more details if applicable.

If you cannot get your job back using a violation of good faith and fair dealing argument, you or a lawyer may be able to negotiate for you to obtain benefits you were expecting and would have received but for the firing. You should also consider asserting a claim for benefits based on ERISA rights (discussed below).