"You will not be eligible for unemployment because you are quitting," said John's boss and HR manager.

That makes sense, right? But there was a lot more to the story. John's company wanted to transfer him across the country--from Indiana to Arizona. He turned down the transfer, and so they said he had to resign and wouldn't be eligible for unemployment or severance--because they had offered him a perfectly good job.

Fortunately, John thought that was a bit suspicious and he sent me an email.

While it's generally true that if you quit your job, you're not eligible for unemployment, it's not always true. While each state has their own regulations around unemployment eligibility, as a general rule, if the business is moving and it would be a hardship for you to work at the new location, you'll be eligible for unemployment. Moving across the country would be considered a hardship. Moving down the block would not.

Armed with this information, John went back, and here's what happened. He writes:

Thank you very much for your reply.  After reading your message and then consulting the handbook for the department of workforce development in my state I confidently walked into work this evening and informed them I would NOT be relocating from Indiana to Arizona.  They attempted to give me the same lecture about not getting severance or unemployment and I simply replied "We'll see what the state says" and went back to my desk.

An hour later they called me in to review my severance package.  I was also able to get them to increase their offer after I cited how much I could potentially get from unemployment compared to their offer.  

Knowledge is Power!  

Excellent job, John! Knowledge really is power. And any HR manager worth her paycheck should have known--and undoubtedly did know--that he would be eligible for unemployment. But bad HR happens. If you're lying to the employee's face, you are a bad HR person, even if your boss wants you to do so.

Now, again, as a general rule, companies don't have to offer employees severance. Almost all of the US (Montana is the exception) has "at-will" employment, which means you can quit and they can fire you without notice and without severance unless you have a contract. (Most likely, you do not, unless you are in a union or are a senior executive.)

So, why did John's job offer him severance? Well, they could really be averse to paying unemployment, which is dumb. I suspect, though, that with the business moving across the country, they are subject to the  Worker Adjustment and Retraining Notification Act (WARN). If you're subject to this, you either have to give workers 60 days notice or pay them severance.

One more bit of knowledge for John--while I don't know the law specifically in Arizona, he may still be eligible for unemployment with severance. In many states, he would be, although he may have to wait for his severance to run out to apply.

If you think your boss or HR is being unreasonable in the face of termination, check into it! Consult an employment attorney, call the state agency, or even try sending me an email (EvilHRLady@gmail.com). I'm not an attorney, but I may be able to point you in the right direction.

Don't let dishonest people win. 

Published on: Mar 29, 2019
The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.