Every layoff term you actually need to know.

Plain-language definitions of 41 terms that come up after a layoff. Money, legal, search, process, identity. No jargon. Where a term has a legal meaning, the definition flags it and points at the authoritative source.

Not legal, tax, or financial advice. If the dollar figure or legal stakes are large, talk to a professional.

Money 9 terms

Severance: A payment from your employer at the end of your role. Not a legal requirement in most US states — it is a negotiation, structured as either a lump sum or salary continuation. Typical band is one to two weeks of pay per year of service for individual contributors, more for managers and executives.
Salary continuation: Severance paid out across your normal pay schedule (every two weeks, monthly) instead of as a lump sum. Better for taxes, better for keeping healthcare on the employer plan during the window, and often the form senior leaders negotiate for.
Pay in lieu of notice: A payment that replaces an advance-notice period the employer was supposed to give but did not. Under federal WARN, that window is 60 days; some states require longer. This is separate from severance.
Final paycheck: The last regular paycheck for hours worked. Most states require it within a specific window after your last day — sometimes the same day for involuntary terminations. Distinct from severance.
PTO payout: Cash for the unused vacation balance you had on your last day. Required in some states (CA, IL, MA, others), not in others. If your state does not require it, it is negotiable.
401(k) rollover: Moving your retirement balance from the employer-sponsored plan into an IRA or your next employer’s plan. Direct rollover (trustee-to-trustee) avoids the mandatory 20% federal tax withholding that applies to indirect rollovers.
Vesting cliff: The date your stock or RSUs become yours. At layoff, only vested equity is yours; unvested equity returns to the company. Some severance packages include "acceleration" — pulling forward the next cliff.
Bonus pro-ration: A partial bonus for the part of the year you worked. Whether you get one depends on the policy and the offer. Worth asking for explicitly.
Runway: The number of months your cash on hand will cover your essential monthly expenses. The basic equation: liquid savings divided by monthly burn. Knowing the number lowers anxiety more than any other single thing.

Legal 16 terms

WARN Act · WARN: The Worker Adjustment and Retraining Notification Act (29 U.S.C. § 2101). Federal law requiring employers with 100+ full-time employees to give 60 days written notice (or 60 days pay in lieu) before a plant closing affecting 50+ workers or a mass layoff of 500+ — or 50–499 if they are 33% of the workforce at a site.
Mini-WARN: A state-level WARN equivalent with stricter rules. Ten states have one: California, Illinois, New Jersey, New York, Tennessee, Wisconsin, Hawaii, Maryland, Oregon, Vermont. New Jersey requires 90 days notice plus one week of severance per year of service.
ADEA: The Age Discrimination in Employment Act. Protects workers 40 and older from age-based discrimination. Relevant at layoff because of OWBPA (see next).
OWBPA: The Older Workers Benefit Protection Act, an ADEA amendment. If you are 40+ and your employer asks you to sign a release of age claims, you have 21 days to review (45 days for group layoffs) plus 7 days to revoke after signing. Do not sign on the spot — taking the full window is your right.
Release agreement: The document at the end of a severance package where you agree not to sue your former employer in exchange for the payment. Once signed, most legal claims are waived. Read it carefully; have an attorney review if the package is large.
Non-disparagement: A clause in a release agreement that prohibits you from speaking negatively about the company. Often one-sided; you can ask for it to be mutual.
Non-compete: A clause restricting you from working at a competitor for some period. Enforceability varies sharply by state — California and Oklahoma do not enforce them at all; the FTC tried to ban them in 2024. Always negotiate scope and duration if one is in your agreement.
Non-solicitation: A clause preventing you from recruiting your former coworkers or clients for some period. More commonly enforceable than non-competes. Usually negotiable.
Garden leave: A period where you are technically still on payroll but not working, often after notice is given. Common in finance and senior tech roles. Your non-compete clock may run during it.
At-will employment: The default US employment status in 49 states (Montana excepted). Either side can end the relationship at any time, for any non-illegal reason. A layoff does not "violate" at-will employment; it is at-will employment.
Constructive discharge: When the working conditions become so intolerable that a reasonable person would resign. Treated legally as a firing rather than a resignation. Hard to prove; consult an attorney before acting on it.
Retaliation: Adverse action by an employer in response to a protected activity (filing a discrimination claim, reporting harassment, etc.). Separate from "fair" or "unfair" — it is illegal regardless of whether the underlying complaint was upheld.
COBRA: A federal law (Consolidated Omnibus Budget Reconciliation Act) letting you keep your employer health plan for up to 18 months after job loss — at full cost, plus a 2% admin fee. Often expensive; the ACA Marketplace is usually cheaper for individuals and families with reduced income.
ACA Marketplace: HealthCare.gov and state health-insurance exchanges. Job loss triggers a 60-day Special Enrollment Period — you can sign up outside the normal open enrollment window. Subsidies are based on your full-year income; if your year drops, your plan gets cheaper.
SLCSP: Second-Lowest Cost Silver Plan. The benchmark plan the ACA uses to calculate your premium tax credit. Your subsidy is the amount that would make the SLCSP cost 8.5% of your household income (less if your income is under 400% of the Federal Poverty Level).
FSA vs. HSA: A Flexible Spending Account is use-it-or-lose-it and tied to your employer; the balance is usually forfeited at layoff. A Health Savings Account is yours to keep — it travels with you. Confirm which you have.

Search 7 terms

ATS: Applicant Tracking System. The software that screens, filters, and routes résumés before a human sees them. Most large employers use one. Format choices that matter: clean text, no tables, exact keyword matches to the job description, and a PDF if possible (some ATS strip Word formatting).
RIF: Reduction in Force. The HR euphemism for a layoff. Different from a firing — your separation reason on unemployment claims should be "lack of work" or "layoff," not "termination."
Boomerang hire: A former employee re-hired by the same company. Increasingly common at scale-ups going through reorgs. If you left on decent terms, your old manager is a real path back.
Reference check: The call from a prospective employer to a former one verifying employment dates and (sometimes) work performance. By US default most former employers will only confirm dates + title. A reference letter you negotiated upfront is more reliable.
Backchannel reference: When the hiring manager calls someone you used to work with whom you did not list. Common at small-world industries. Worth knowing who at your old company would not give you a good informal read, and being honest with the recruiter about it.
Take-home assessment: A timed project a candidate completes outside the interview. Worth doing well; not worth doing for unpaid for many hours at multiple companies. A reasonable cap is four hours.
Offer letter vs. employment agreement: An offer letter summarises the deal in plain language; the employment agreement is the legal document. They are not always the same. Read both. The agreement is what controls if there is a dispute.

Process 6 terms

Notice period: The advance warning before a layoff takes effect. Federal WARN gives 60 days for qualifying layoffs; state laws vary. Many smaller layoffs come without notice at all, which is legal in most cases.
Severance window: The period over which severance is paid. During salary continuation, you remain on payroll and (usually) employer benefits. Healthcare continues during this window.
Outplacement: A service some employers pay for after a layoff — a career coach, résumé help, job board access. Typically priced at $1,500–$5,000 per person for the company; the value to the laid-off worker is variable. Negotiable up or down.
Unemployment insurance · UI: A state-run program that pays a portion of your former wages for a set number of weeks if you lost your job through no fault of your own. Funded by employer payroll taxes, not from your past paychecks. Filing the same week as your layoff matters — the waiting period starts at filing.
Continued certification: The weekly or bi-weekly check-in your state requires while you receive unemployment. You confirm you are still unemployed, still able to work, and still looking. Missing a certification stops payments.
Wage base: The dollar amount of past wages your state uses to calculate your weekly unemployment benefit. Usually some recent quarter of earnings. Each state caps the weekly benefit regardless of how high your previous income was.

Identity 3 terms

Imposter syndrome (after layoff): The sense that being laid off "exposes" you as having never deserved the role. Almost universal, almost never true. Layoffs are budget decisions, not performance reviews.
Job-loss grief: The recognisable, time-limited mourning that follows losing a role you cared about. Not a clinical diagnosis; just an honest description of why the first two weeks feel like they do. Most people are functional again by week three or four.
Career capital: The accumulated skills, relationships, and reputation that travel with you. Your role ended; your career capital did not. Worth listing explicitly before applying anywhere new.

Beyond the definitions

Knowing the words is step one.

CareerCanopy translates these into a plan built around your situation — what to do this week, what to expect this month, what to ask for in the conversation.

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