Unemployment issues due to recent cash advance industry law.
I have some questions that affects 6,000 people here in Ohio - Ohio law (H.B. 545) which is effectively closing down the industry.
My company is passing along information to it's employee's that make me wonder if they have our best interests at heart. Are they saying whatever they need to say in order keep people working until we show up one day and the doors are locked?
1) They say they will be able to stay open until November because of the 240,000 signature referendum the CFSA is working on. (the law takes effect Sept 1) Is it possible to put on hold a law?
2) We are being told not to worry about our jobs because of the secret new "product" they are about to unveil that will keep us all working. Does the new law allow for something like this?
3) We have been told we will receive two weeks severance pay for every year worked if we stay until..... But nothing in writing. I'm afraid this promise will vaporize when the time comes. Then I'm out there with 6,000 other people hitting the job market all at the same time.
4) Is the severance pay a ruse to avoid paying employee's unemployment. I have been told you can't collect severance and unemployment. Will I unknowingly be waiving my rights to unemployment if I take severance?
I will pass this information along to every employee I can. Everyone is scared and afraid. For some of my fellow workers, this is the only job they have ever had.
Answers (1)
To answer your questions:
1. I am not an expert, but I believe that the filing of a referendum suspends the effective date of a new law until after the General Election. If the referendum passes, the law does not go into effect. If it fails, the law goes into effect at that time. A blog following the PayDay referendum is at http://www.bluebexley.com/.
2. Any new product will have to comply with the law. I am not an expert on the new law, but I understand that it caps the annual interest rate at about 28% and limits fees. I also understand that the Payday lending practices that the new law is designed to stop result in triple digit annual interest rates. It is difficult to see how a secret new product could generate similar returns for the payday owners. I would be suspicious that it does not exist.
3 A promise to pay severance in exchange for you remaining with the employer through a difficult time are valid and enforceable. However, get it in writing. Further, even if it is in writing, if your employer will simply disappear once it closes up, then you may not be able to collect on what will amount to an empty promise.
4. If you are receiving a weekly severance check from your former employer, the unemployment compensation benefit to which you are entitled will be reduced by the amount of the weekly severance check. The result may be different if you receive severance in a lump sum.
So, now is probably a good time to start looking for new employment. If you find something comparable to your payday loan job, take it. If your employer wants you to stay with it until the new law is defeated or goes into effect, make sure you will, in fact, receive the promised benefit.
If you stay with your current employer and do nothing, you may well lose your job in September or November. At that time, you should be eligible to receive unemployment compensation benefits. Whether or not you receive a promise for severance pay and/or can collect it is, in both cases, up to the specific employer.
I regret that so many people will lose their jobs as a result of this law, particularly during these hard times. I hope that this helps you navigate your way to a better end.
Best regards,
Neil Klingshirn.
posted by Neil Klingshirn | Jun 20, 2008 12:25 PM [EST]
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