In response to media reports about severance packages received by government employees, on August 14, 2018 the Illinois Senate’s Committee on Administrative Rules passed Senate Bill 3604 / Public Act 100-0895 [1], also known as the Government Severance Pay Act (GSPA).This law requires local governments, school districts, community colleges, universities and other public agencies to include specific limitations in future employment contracts (which includes a new contract, as well as a renewal or renegotiation of an existing contract) if those contracts contain a provision for severance pay. Under the GSPA, severance pay is prohibited if the individual is fired for misconduct. If the individual is not fired for misconduct and otherwise qualifies under the terms of their employment contract, the GSPA limits severance pay to no more than 20 weeks of compensation. It is also important to note that the GSPA does not mandate severance pay in public agency employment contracts and does not create an entitlement in the absence of contractual or legal authorization. The GSPA simply establishes limitations on the availability and amount of severance pay for future employment contracts.
Public agencies, including local governments and school districts, should carefully consider the provisions of the GSPA when negotiating severance terms in any future employment contracts.
Upcoming Tressler Presentation
Illinois Municipal League Annual Conference [2]
September 21, 2018
Chicago, IL
Presentation: “Pitfalls and Ways to Avoid Them for Workers’ Compensation and Retaliatory Discharge Issues”
Speakers: Stephanie Donovan and Peter Murphy
Conference Website: http://www.iml.org/conference [2]
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