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Wrongful termination settlement - Do I have to pay back Unemployment Bene's?

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Proseguru

Member
What is the name of your state (only U.S. law)? Florida Is there a way I can get them to cut a check so that it isn't reported on a W-2?
Its possible that your lawyer would be willing to accept a 1099 for the entire amount and then disburse to you the required amount. Then you would only need to pay federal/state income tax & not the other employment taxes. Some lawyers & companies will do this and some won't....just another option. (The lawyer would not get stuck with paying taxes on the amount he gives you fyi)
 


swalsh411

Senior Member
That's right. To make them whole. Not to provide a windfall
So what are punative damages then? There has to be an incentive for entities to not break the law. If all lawsuits did was make them pay what they would have had to pay had they followed the law, there is no incentive not to break it in the first place. A component of a settlement or judgement is to hit them where it hurts. Since you can't normally put employees of a company in jail or shut them down as a result of a civil action, the only way to make it hurt for them is to hit them in the wallet.
 

Zigner

Senior Member, Non-Attorney
So what are punative damages then? There has to be an incentive for entities to not break the law. If all lawsuits did was make them pay what they would have had to pay had they followed the law, there is no incentive not to break it in the first place. A component of a settlement or judgement is to hit them where it hurts. Since you can't normally put employees of a company in jail or shut them down as a result of a civil action, the only way to make it hurt for them is to hit them in the wallet.
We're not talking about punitive damages here.
 

Whistleman

Junior Member
Thanks everyone. I really appreciate all of the detailed responses (especially commentator).

Basically, we have not filed with the courts yet. We are pretty much at the SOL, so that explains the time constraints. The offer is pretty much your standard "here is X amount for back/lost wages", in addition to Release covenant not to sue and assignment of all claims, Confidentiality, ect.

BTW, while I live in Florida I am receiving UI benefits from another state, the state the employer resides in.

I tend to agree with Proseguru in his rationalization. Wages are income earned for services provided. Nothing has been provided. There is a weekly question that reads:

"Did you receive other income from any of the sources below that you have not already reported such as Retirement or disability pension, Worker's Comp, or Additional payment, such as severance pay or wages instead of providing advance notice of work separation? Check all that apply:

1. Retirement or disability pension
2. Worker's Compensation
3. Additional payment when you left your job other than wages you had earned
"

So, should I just not worry about it and deal with it if it ever comes up, or should I report it the week I receive it under #3 above? And then they will just count it as no benefits for that one week?

Or should I just have my attorney have the terms changed so that it doesn't read "back wages"? But then what would we change it to? Our initial letter of intent to them only mentioned loss of wages and benefits. Is it too late to claim say "damage to my earning potential due to my extended lack of employment", emotional, etc. ?


Again, I very much appreciate the feedback.

Again, thanks again for all of the great responses. It is much appreciated.
 

Proseguru

Member
Will you also be required to abandon all possible actions regarding company employees too?

Really, your lawyer should know the answers to you inquiries ...

It appears that they are settling all claims against the company and will pay you via a W-2. So I think you are OK here but you should have the agreement in writing signed & countersigned before the SOL runs out.

If the SOL runs out, they could just walk away.
 

eerelations

Senior Member
I'm getting a suspicion that OP hasn't even started the court case yet...if so all this negotiating a settlement discussion is 'way too premature at this point. There's a 50/50 chance there won't even be a settlement!
 

commentator

Senior Member
My point exactly. We can't go over and over the whys and wherefores of something that has not even happened yet and may never happen. Lotta people think they have a whistleblower case, and this very well may not be one where you win any kind of settlement.

All I can tell you is, if you are dealing with the interstate unit of Florida, you will have someone who is a contact in the Florida system. IF you ever receive the settlement, you need to call them and ask them if you'll be required to return your unemployment. You also need to ask them if you need to report the money on the week it is paid to you, though the answer to that is No, it is not wages for work performed in that week.

My advice is stop thinking about this at this point. File your suit, get it done, and then duly report the money. "My thinking on this is..." as you say, will not amount to a hill of beans. It is how the unemployment system in whatever state you are drawing the claim from looks at it. It doesn't matter a whole lot about how they word it. Settlement damages vs. calling it "backpay." Worry about tax responsibilities, not unemployment.
 
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