Employee Termination Vs. Layoff

There is a fine line between employee termination and lay off.

You've probably all heard of employee terminations and layoffs. There is a subtle difference between the two terms, as well as the legal issues surrounding each one.

Termination

Termination usually means that the employee is being let go with no chance of being brought back or rehired. In many cases, an employee is terminated or fired because of poor performance or some type of rules violation.

Layoff

Layoff typically points to a lack of work for the employee, usually caused by economic conditions or shifts in the organization's production. A layoff generally means that the employee would be eligible for rehire or to be brought back to his position if conditions change or improve.

Unemployment Rights

Individual states govern unemployment payment, but in general a laid-off employee, that is, a person who has lost his job due to no fault of his own, may be eligible for unemployment. If an employee is terminated due to his own fault, he most likely will not be eligible for unemployment payments.

Legal Issues

If your employer cannot prove the intention to rehire you in a layoff, there may be grounds for legal action. This is why employers should use extreme caution in labeling an action as termination or layoff.

State Laws

State employment laws are different, especially those governing the payment of unemployment benefits. If you have questions, contact your state's department of labor or workforce innovation.

References

• State of Oregon Bureau of Labor and Industries

Resources

• U.S. Department of Labor: Termination