04. Total or Partial Unemployment

Hamilton v W A Foote Memorial Hospital – 4.18

Hamilton v W A Foote Memorial Hospital
Digest no. 4.18

Section 4850

Cite as: Hamilton v W A Foote Memorial Hosp, unpublished opinion of the Jackson Circuit Court, issued October 3, 1984 (Docket No. 84-33223-AE).

Appeal pending: No
Claimant: Joseph W. Hamilton
Employer: W. A. Foote Memorial Hospital
Docket no.: B83 09754 93402W
Date of decision: October 3, 1984

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CIRCUIT COURT HOLDING: Payments made to claimant after his separation and after he stopped performing services were severance pay, in light of the fact both parties characterized them as such and claimant had no right to payment in lieu of notice.

FACTS: The claimant worked for the employer as a controller. The employer requested the claimant’s resignation. After the claimant resigned the employer continued to pay the claimant on a bi-weekly basis for a six month period. Notably, both parties referred to the payments as “severance pay”. Upon filing for benefits the claimant asserted the monies received were remuneration under the Act and could be used to establish credit weeks.

DECISION: No remuneration was earned and no credit weeks could be established based on the payments in question.

RATIONALE: It is necessary to determine the understanding of the parties at the time of the separation. Here, both parties referred to the payment as severance pay. Further, the claimant did not perform any services during the six month period.

The court quoted from Bolta Products v Director of Employment Security, 356 Mass 684 (1970), : “A payment in lieu of dismissal notice may be defined as a payment made under the circumstances where the employing unit, not having given an advance notice of separation to an employee, and irrespective of the length of service to the employee, makes a payment to the employee equivalent to the wages which he could have earned had he been permitted to work during the period of notice. Severance pay, on the other hand, may be defined as a payment to an employee at the time of his separation in recognition and consideration of the past service he has performed for the employer and the amount is usually based on the number of years of service.”

Digest Author: Board of Review (original digest here)
Digest Updated:

04. Total or Partial Unemployment

Hayman v S & H Travel Awards – 4.13

Hayman v S & H Travel Awards
Digest no. 4.13

Section 48

Cite as: Hayman v S & H Travel Awards, unpublished opinion of the Oakland Circuit Court, issued May 4, 1976 (Docket No. 75 126038).

Appeal pending: No
Claimant: Judith Hayman
Employer: S & H Travel Awards
Docket no.: B74 11222 46917
Date of decision: May 4, 1976

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CIRCUIT COURT HOLDING: Where an employer customarily asks its employees to leave on their dates of termination, and pays them “severance pay” determined by each person’s salary and seniority, the additional money is not payment in lieu of notice.

FACTS: The Referee stated: “On the date of her dismissal, the claimant received three weeks of vacation and five weeks additional pay which has been considered by the employer to be payment in lieu of notice.”

DECISION: The additional pay is not remuneration under the Act.

RATIONALE: The Court adopted the decision of the Referee, who held: “The testimony indicated that, because of the risk of former employees providing the names of prospective customers to competitors, whenever an employee’s services were no longer needed, they were asked to leave employment on the same date that they were terminated. That is, employees were not given a certain time period as a notice of their termination during which they could seek other work. This being the case, the Referee does not find that the payment of five weeks of wages given to the claimant on her last day of employment could be considered payment in lieu of notice. The only time payment in lieu of notice could be given to an employee would be on occasions when it would be possible for notice to be given.” “In addition, it appears from the testimony that the claimant was advised that the payment she would be receiving would be in the nature of a severance payment.” “It also appears that the amount of the severance pay increased the longer an employee was employed by the company and the greater his or her, salary.”

Digest Author: Board of Review (original digest here)
Digest Updated: