Last year, Publix Super Markets, Inc. had purchased 49 Albertsons supermarkets in Florida. The move came unexpectedly, after management attempted to dispel rumors that they were selling. Over 5000 employees would be effected by the decision, but it seemed that Albertsons and Publix had a plan. Albertsons would offer a severance agreement to hourly employees, but there were a certain set of conditions that Albertsons had established.
Albertsons' human resources department descended on every store to outline the protocol surrounding the severance plan, in which papers were handed out stating such rules. Albertsons' spokespeople had also told various news agencies the following set of rules to receive severance. The employee would have to attend a job fair with Publix, to see if Publix would be willing to hire the employee. If both Publix or Albertsons offered a job to the employee, and the position paid up to 80% of their current wages and was located within 50 miles of the location that they worked, then they would not be elligible to receive the severance. If the employee was not offered a job, or offered a job that was further then 50 miles or lower then the 80% of their current wage, then they could turn down the offer and still be eligible to accept the severance agreement. If the employee did accept the severance agreement, they would not be allowed to work for Albertsons for 6 months. The severance plan would equal one week of pay for each year of service, plus 6 months of paid COBRA benefits. One other requirement was that you had to finish working for Albertsons until you were formally let go.
While the arrangement sounds somewhat fair, although in theory, either company could offer you a job that paid less and was a considerable distance away, and you would lose your severance. Also consider the price of gas last summer, where it reached $4 per gallon, and we are talking about a significant increase in costs to the worker. For Albertsons, it would benefit them to offer an employee a job at a location out of the way for less, for the sole purpose of refusing severance. For Publix, it gave them an opportunity to pick up skilled workers, and since they purchased 49 stores, if they were to open all supermarkets, then they would have to fill each store with knowledgable associates.
Unfortunately, Albertsons had decided to act inappropriately, and so I am writing this article for those who may face similar experiences. I was an employee at Albertsons, and I had qualified for the severance agreement, but Albertsons refused to offer a pay out.
As mentioned above there were a certain set of requirements for one to receive the severance plan. In my situation, I had attended the job fair, but was not offered a job. Albertsons had also not offered me a job. I finished working up until the day the store closed and then I was unemployed. I asked Albertsons when I will be getting my severance plan and I was told that everything was in the mail. While searching for a job, I had gone on unemployment and had started to receive benefits, but I still had not received any information regarding my severance. I had called Albertsons but was told everything was in the mail and that the human resources manager was on vacation, so I would have to call back at a later time. While waiting for my severance agreement, I had received information from the company administering COBRA benefits, but instead of notifying me that Albertsons had paid for my insurance continuation, it stated that I needed to pay over $700 a month to maintain my insurance. Unsure of this, my wife had called Albertsons to find out about this letter. She was told that we would have to pay the amount.
In the meantime, I had decided to try and reapply at Publix, since every other place I had applied to had either rejected my application or had notresponded and I was unsure of if I had insurance coverage anymore, and I needed to make sure I had coverage for me and my family. Publix had subsequently hired me. While I was starting with Publix, the Albertsons human resources manager had just gotten back from vacation, and I had finally gotten a hold of them. I was told that I was not eligible for severance because I was working for Publix. I had stated that I followed all the procedures outlined by the company but had not received my severance agreement. I was told that I accepted a job before my termination at Albertsons and that it fell within the guidelines of 50 miles and 80% pay. When I asked for a copy of such information to be faxed to me, I was told that I was not allowed to have such information because it would constitute "internal documentation". When I stated that I was on unemployment benefits after my release from the company and that I had proof of receipt of such payments, I was told that Publix would not lie and that I was not eligible. I was told I should be lucky to have a job.
I was confused. I followed every detail outlined by my former employer but I was still being denied my severance, which would have totaled close to $3000, plus 6 months of health insurance coverage for my family. Now I had lost the $3000 and health coverage. I was mailed a certificate of eligibility for my health insurance which pretty much allowed me to continue full coverage with another plan, but I would have to obtain the plan within roughly two months. It had already been a month since I was terminated, and Albertsons was not willing to resolve the matter. I had contacted the human resources manager again to try and straighten out the information. Finally, I started to get somewhere, or so I thought. I had again requested the information used to deny my severance and I was again denied, but as I continued to probe, it became clear that there was a mix up. An employee with the same name and eerily similar social security number had accepted a job with Publix. The information was transposed and it said that I was offered employment. This explains a little bit, but not everything. I asked why I was not still eligible for the severance, and I was told because I was currently working for Publix, and that I would have had to wait 6 months before seeking employment with them. Confused, I referred back to the meetings held by the human resources department. Back in the meeting, we were not told of any non-compete clause. The human resources manager told me that they had not mentioned it at that time, or ever. I asked why I did not receive a copy of the severance before or after my termination, so I would have known the full terms of the agreement, and she stated the incorrect information that I was offered a job, and so I was not given the agreement. I was told that regardless when I started working for Publix, I was currently not eligible. My argument was that having that information presented to me, my decisions would have been different, considering I was unemployed and I had just received my tax bill for the year for my house (which was still high from the inflated value of my property from the housing boom) and the need for health coverage.
I was given a copy of a summary plan of the agreement by a friend who also worked for the company and who was also eligible to receive severance. In the severance agreement, there was another clause that would disqualify you from receiving benefits if you told anybody about the severance plan or talked badly about Albertsons, so not only did they tell everybody it was "in the mail", but they also barred those from receiving one from telling those who didn't what the plan contained. What was interesting was that in the severance plan was also instructions about the administering of the plan, which stated that the plan would have to be given out prior to termination, which Albertsons had effectively failed to do for the over 5000 employees (which I am sure was done conveniently to help avoid pay out of even more plans).
I was told that I would have to appeal the decision by Albertsons by writing a letter to their main human resources department. I had done so, citing several violations of their own severance agreement, as well as particular federal law which outlines the disclosure of information when regarding severance plans. As expected, Albertsons spent over a month to respond. By then, I had lost all insurance coverage for myself and my wife, as well as eligibility, which complicates the matter further because of preexisting conditions. I had finally received a response in December, 3 months after my termination, in which a head of Albertsons' human resources department, a lawyer, cited the incorrect information used to deny me in the first place and ignored all facts that pointed to Albertsons violating their own severance agreement first.
I write this article as a warning because it is only a matter of time before Cerberus Capital Management decides to sell off the rest of their Florida stores, and another group of employees face the Albertsons severance plan. For those people, I had posted the Albertsons severance plan for hourly and salaried store and distribution center employees in my previous post...