Re. - Cover letter outlining the terms of my separation of employment I am trying to figure out what this paragraph (3.C) below means? 1.) Does it mean that they will stop paying my severance if I get another job? 2.) Will my former employer only pay me the difference of what my severance paycheck would be minus what I am paid in the new salary? 3.) Or do they mean that with an increased pay (severance + new salary) they will recalculate the deductions from my severance paycheck based on that increased amount? 3.C. "You shall use reasonable efforts to seek actively other employment comparable toyour employment with the Company and, if you accept other employment afterthe Termination Date and before payment is completed, whether suchemployment is full-time, part-time or as an independent contractor, the biweeklyamount of salary earned from such other employment (whether paid or deferred)will be set-off against the balance of amounts payable to you. You shall, upon acceptance of other employment, provide the Company with written notice ofcompensation due you which information shall be maintained in strictestconfidence by the Company and will be used only the Company for purposesof calculating the deductions to be made from the balance of payments due youunder this Paragraph 3."
State/Country relating to question: New York
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QUESTIONS: "1.) Does it mean that they will stop paying my severance if I get another job? 2.) Will my former employer only pay me the difference of what my severance paycheck would be minus what I am paid in the new salary? 3.) Or do they mean that with an increased pay (severance + new salary) they will recalculate the deductions from my severance paycheck based on that increased amount?"
ANSWER: Here is how this works. Your middle or second question provided the most accurate description. You are agreeing to exercise "reasonable efforts" to find employment. The specifics are not defined, but it is less than "due diligence" or "best efforts". In other words, it is a bit analogous to receiving Unemployment Insurance benefits. The contract is saying you are not going to merely sit around and deliberately stay unemployed. On the other hand, it does not require that you go to any certain lengths to get a job. In terms of the off-set, it works like this. Assume for illustration that you receive $100 per month in severance. You secure other employment paying $50 a month. Hence, your revised monthly severance amount would be $50.
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