No that's not a fair way to do it if you take info account the fact that the employee has to sign away not just their rights to sue, but their right to full unemployment benefits.
He's not actually firing people, he's pressuring and bribing them into resigning voluntarily.
It's basically a nasty way of breaking the social contract of the employer - employee relationship, shifting what should be the entrepreneurial risk of the employer to the employee, without any upside for the latter.
I take back what I said about the legality however: it's fully legal and very common in the EU, it just isn't firing people.
I've seen it used in practice. There's nothing nice about it, and almost always the result of bad hiring. Only employees that wanted to get out anyway or are easily intimidated go along with it. And it can seriously bite you in the ass if the employee tells you to shove it and forces you to take it to court instead. (Because they don't really need to sue, any firing after that conversation will be illegal.)
> No that's not a fair way to do it if you take info account the fact that the employee has to sign away not just their rights to sue, but their right to full unemployment benefits.
That's going to depend heavily on the jurisdiction. Where I am (Massachusetts), you cannot receive unemployment insurance for the same weeks covered by a severance package (which seems reasonable; I can't get unemployment for weeks in which I'm being paid a salary either...), unless that severance package requires the employee to sign a release of claims against the employer. If it does, then you can receive unemployment income for the same weeks covered by severance.
In every case I can think of, here in MA, employees terminated under such an arrangement have right to full employment benefits. I'm sure that will vary in other places to some degree.
In many jurisdictions, unemployment only covers 6 months, and it pays much less than an actual job. It also doesn't have taxes deducted, which can screw you over later.
When I was last unemployed, I qualified for maximum benefits, which was about half my post-tax salary at the job I got laid off from, but the unemployment money was pre-tax. I suppose I should be "lucky" that this occurred during the Great Recession, when unemployment got extended to 2 years (it's back to 6 months now), but I don't feel very lucky.
6 months of my old salary would be strictly better than unemployment, especially unemployment now that extended benefits are gone.
Oh, I actually didn't know that by signing such a document the employee would sign away their right to full unemployment benefits.
That's a very good point. I've just checked and, in France (where he is from originally), when an employee resigns, he's not eligible to unemployment benefits. I actually come from France but I haven't really worked there so I didn't know...
He's not actually firing people, he's pressuring and bribing them into resigning voluntarily.
It's basically a nasty way of breaking the social contract of the employer - employee relationship, shifting what should be the entrepreneurial risk of the employer to the employee, without any upside for the latter.
I take back what I said about the legality however: it's fully legal and very common in the EU, it just isn't firing people.
I've seen it used in practice. There's nothing nice about it, and almost always the result of bad hiring. Only employees that wanted to get out anyway or are easily intimidated go along with it. And it can seriously bite you in the ass if the employee tells you to shove it and forces you to take it to court instead. (Because they don't really need to sue, any firing after that conversation will be illegal.)