News & Analysis as of

Severance Payments to Terminated Employees are Taxable Wages under FICA

The Supreme Court recently held that severance payments made to involuntarily terminated employees constituted “remuneration for employment,” for which taxes must be withheld and paid under the Federal Insurance Contributions...more

High Court Rules Some Severance Payments Are Taxable

Yesterday, the Supreme Court of the United States held that severance payments are taxable under the Federal Insurance Contributions Act (FICA) when made to employees whose employment is involuntarily terminated. The Court...more

Be Sure to File a Protective Claim for FICA Taxes

The Supreme Court has agreed to review the Sixth Circuit Court of Appeals decision in United States v. Quality Stores which held that severance payments to involuntarily terminated employees were supplemental unemployment...more

Supreme Court to Decide Whether RIF-Related Severance Pay Is Subject to FICA

Although some would argue that the next U.S. Supreme Court term is not shaping up to be as monumental as the last term, employers should have their eye on the recent decision of the Court to hear United States v. Quality...more

Is the Severance that Your Company Pays to Fired Workers Taxable? The Supreme Court Will Decide

On October 1, 2013, the Supreme Court of the United States agreed to hear a case concerning whether employees’ severance payments are taxable. The case, United States v. Quality Stores, Inc., came out of the Sixth Circuit...more

Employee Relief Causes Employer Grief: The ability to perform employment-related duties is an integral part of an employment...

Recently, two employers who provided notice of termination, and at the same time relieved employees of their duties, were held instead to have at that time terminated those employees, which lead to financial consequences for...more

Termination payments - Johnson, Reid and the importance of clear compromise agreements (United Kingdom)

The income tax treatment of termination payments is an area fraught with subtleties and uncertainties and is often open to fine interpretations. Whilst the general principles involved in determining the tax treatment of a...more

Quick Tips on Dealing with Employment Termination Issues in China

On June 21, 2013, a United States medical supplies company executive was taken captive by Chinese employees in his Beijing factory. The employees have stated that the owner owes them two months’ back pay and expressed concern...more

International Dismissal Toolkit: Individual Employment Terminations and Reductions-in-Force Outside the United States

Firing an employee in the United States can be a challenge. Group firings—reductions in-force — can be an even bigger challenge. And from the point of view of a multinational headquartered in the United States, overseas...more

Global HR Hot Topic - May 2013: Individual Employment Dismissal Obligations Outside the US

Challenge: Overseas, dismissing an individual employee gets complex and is heavily regulated. Dismissal mandates under foreign law tend to fall into three broad categories: dismissal procedures, pre-termination notice...more

Fenwick Employment Brief - March 2013

In This Issue: - Feature Articles: - California Court Of Appeal Significantly Expands Pregnancy Leave Rights - New York Employer's Flex-time Policy Precluded Holding Employee Accountable For Tardiness...more

Employment Law in Costa Rica: A Country Protective of its Employees and Natural Environment

On January 9, 2013 it was reported in thecostaricanews.com that the Costa Rican government has announced a new aggressive policy to attract foreign investment. According to the article, the government of Costa Rican’s...more

ERISA Severance Plans and Non-Compete Agreements Must Work Together

In an ever-more competitive business climate, employers are increasingly interested in protecting revenue streams through enforceable non-compete restrictions on employees. A recent federal district court decision highlights,...more

Doing Business in Canada: Employment & Labour

The relationship between an employer and an employee in Canada is heavily regulated. All jurisdictions in Canada – both federal and provincial - have enacted legislation (statutes and regulations) governing various aspects of...more

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