Section 48
REMUNERATION, Discharge, Payment in lieu of notice, Severance pay
CITE AS: Hayman v S and H Travel Awards, No. 75 126038, Oakland Circuit Court (May 4, 1976).
Appeal pending: No
Claimant: Judith Hayman
Employer: S & H Travel Awards
Docket No: B74 11222 46917
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."
11/90
NA