Worker gets unemployment after taking early retirement

An employee could collect unemployment compensation after accepting an early retirement package as part of his company’s reduction in force, the Pennsylvania Supreme Court recently decided.

The worker was a 63-year-old shipping clerk whose employer announced a round of layoffs due to poor financial conditions. To encourage more senior employees to leave so that more junior employees could keep their jobs, the employer offered an early retirement program. The worker accepted the offer.

He also filed for state unemployment benefits. The unemployment board denied his claim, finding that he voluntarily left his job and therefore was ineligible.

But the Pennsylvania Supreme Court disagreed. According to the court, early-retirement packages are really just another way for employers to accomplish a layoff. Therefore, workers who accept such packages shouldn’t be considered to have left their jobs “voluntarily.”

The law on this issue varies from state to state. If you or someone you know is thinking of accepting early retirement, it’s important to speak to a lawyer about the rights and benefits involved in such an offer.