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Old 27.07.2011, 12:43
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How to avoid penalization of unemployment benefits while agreeing to mutual agreement

Hi,

A friend of mine has been a subject of mobbing possibly with the aim to oust him out of the company for personal differences. After he has sent written communication relating to the harrassment of people in question and being one month on medical leave, the company is finally willing to compensate and finalize the contract on mutual agreement. However it seems that the mutual agreement would penalize him in his unemployment benefits. This is something he obviously cannot except as he does not feel responsible for the situation and has a family to support. If the company fires him (which would not most probably lead to the penalization) then would run the risk of possible litigation. Any thoughts or experience on the mutual agreement and unemployment benefits?

Thanks
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Old 27.07.2011, 12:47
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Re: How to avoid penalization of unemployment benefits while agreeing to mutual agree

One good tip is for him to pepper the market with job applications and keep records. If he shows that he is aggressively looking for an alternative position, the unemployment office will look at him more favourably.

If he's sitting on his bum waiting for something to happen they will apply all the usual penalties without a second thought.
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Old 27.07.2011, 12:50
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Re: How to avoid penalization of unemployment benefits while agreeing to mutual agree

Is there a problem being fired for commercial reasons and receiving a bonus for good work? He should immediately talk to his personnel officer, before they make a wrong move.

In Bern in 2002 I was told to resign in the next 30 minutes or be fired. I resigned and received a very good reference, and the large company (Ascom) told the RAV I was fired for commercial reasons, which was true.

Unpleasant for your friend, but life isn't always a bunch of roses! He now has to start looking for a new job as soon as he receives the dismissal in writing.
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Old 27.07.2011, 13:05
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Re: How to avoid penalization of unemployment benefits while agreeing to mutual agree

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Hi,

If the company fires him (which would not most probably lead to the penalization) then would run the risk of possible litigation. Any thoughts or experience on the mutual agreement and unemployment benefits?

Thanks
There would be no risk of litigation to the company, they can end the contract at any time for any reason, they just need to give notice.
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Old 27.07.2011, 13:09
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Re: How to avoid penalization of unemployment benefits while agreeing to mutual agree

As far as I understand, any severance pay for whatever reason has to be declared to RAV and they will offset any payments. If you don't declare it, I guess it's your choice, but you risk later penalisation.
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Old 27.07.2011, 13:22
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Re: How to avoid penalization of unemployment benefits while agreeing to mutual agree

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As far as I understand, any severance pay for whatever reason has to be declared to RAV and they will offset any payments. If you don't declare it, I guess it's your choice, but you risk later penalisation.
Severance pay if fairly unusual. You will have to produce all payslips until you leave so unless you intend to defraud the RAV they will know.
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Old 27.07.2011, 13:34
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Re: How to avoid penalization of unemployment benefits while agreeing to mutual agree

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Severance pay if fairly unusual. You will have to produce all payslips until you leave so unless you intend to defraud the RAV they will know.
Exactly. Any severance payment will appear on the final salary slip, and will also be listed on the yellow form that the employer gives to the Caisse de chômage.

Having said that (and maybe things have changed recently) a severance payment does not necessarily result in loss of unemployment benefit. When I was made redundant in 2010, I was given the equivalent of two months' salary as severance pay in addition to my three months' notice. When I went to sign on, the RAV initially assumed that I would be requesting benefit from the day after the end of my notice period, and were surprised when I said that I would only be asking for money starting two months later since my former employer was giving me additional compensation. "OK, that's up to you if you want to do it that way but you don't have to" was their reaction.

In the end I found another job before my notice period ended, so I don't know how things would have worked out in reality had I asked for my benefit to start immediately.
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Old 27.07.2011, 14:13
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Re: How to avoid penalization of unemployment benefits while agreeing to mutual agree

There is no problem with compensation. Your RAV pay will start after your written notice period. Any bonus or severance pay will be added to the salary received and is taxable. So RAV pay will increase slightly.
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Old 27.07.2011, 14:37
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Re: How to avoid penalization of unemployment benefits while agreeing to mutual agree

Thank you for your useful contributions. In fact, there should not be any severance pay, just two months pay for the notice period according to work contract + outstanding vacation + no need to be present at work for the last two months in case of mutual agreement. If not agreed they communicated other two options: dismissal or resignation. Obvious possibilities but very confusing given the circumstances, the company does not acknowledge the problem of mobbing and its responsibility to solve the conflict, although my friend presented some proofs and openly discussed.
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Old 27.07.2011, 15:03
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Re: How to avoid penalization of unemployment benefits while agreeing to mutual agree

Make sure the compensation is in addition to x months pay in lieu of notice. That way, you've the income to survive until RAV kicks in.

It is incorrect to say that there are never grounds for legal action. If your employer breaches your employment contract, then there are grounds. And it can get quite expensive for them.

One of the tram firms in Basel (I forget which) had to pay 250'000CHF to a worker who was mobbed.
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