CNBC.COM
If you've just been laid off, you have plenty to take care of as you leave: negotiating severance, collecting your belongings, processing feelings, starting to apply for new roles.
But be careful not to overlook the ways you may be on the hook for some costs on your way out, experts say, such as settling an overdraft on your paid time off or paying back an outstanding 401(k) loan.
"When you're laid off, it's stressful for you, and you may not be thinking clearly in the moment," says Wende Smith, head of people operations at BambooHR. Anything you might owe is "typically tied to some sort of a contract," she says, so that's a good place to start.
She suggests referring back to any prior agreements you signed, including when you were hired, and consulting plan or program documents outlining the fine print around benefits and perks to see what happens to these in the event of your exit, and what you might owe, if anything.
Though the details will vary depending on your specific circumstances and your company's policies, here's what experts say employees usually do and don't need to worry about when it comes to exit costs after a layoff.
What you could — but probably won't — owe
Typically, organizations don't claw back funds if they initiated the departure, such as in the case of a layoff, Smith says. "Funds that may have otherwise been something you were responsible to repay if you voluntarily left the organization, they typically waive that" in a layoff, she says.
"Companies are trying to stay out of lawsuits, and layoffs are risky business," says Tessa White, a former senior HR executive who now runs career consultancy The Job Doctor. "What they don't want to do is poke the bear."
Experts say organizations are unlikely to claw back funds relating to tuition assistance programs, for example, which often require that you stay with your employer for a certain period after earning a degree. While you'd likely have to pay back some of your reimbursement if you decided to leave prematurely of your own accord, companies typically won't go after you for those funds if they initiated the separation, White and Smith say.
Failing to return company hardware like a laptop or cell phone after you leave can also theoretically cost you, but experts say it's not very likely in practice. Companies may send a legal letter to those who are holding out on returning equipment they were asked to send back, but that's rare, says White: "It costs a lot to retrieve property not returned."
However, you should still do your best to return all company property, experts say.
What you're more likely to have to pay back to the company — or yourself
Employers are more likely to deduct other expenses from your last paycheck, and in at least one case, you may owe money to yourself. Here are two common scenarios to be aware of.
PTO overdraft
Overdrawing your PTO against a future balance can cost you on your way out. "If you went into the red and took more than you had, it is not uncommon for a company to claw it back in your final check" by deducting the monetary equivalent of the extra hours you took, says White.
Regulations like the federal Fair Labor Standards Act, as well as state and local laws, affect what employers can or cannot deduct from employees' paychecks and how, so you'll want to consult those as well, says Smith. "It is a very state-specific question in terms of how your final pay will be treated," she adds.
Anything you might owe is typically taken out of your last paycheck, says White, but if it's an unusually large sum, the employer may allow another option for repayment, such as paying in installments over time.
If you do end up on the hook for anything related to PTO or otherwise, you'll want to ask exactly how and when any funds will be deducted, especially as you'll need to make your money stretch further while you're out of work.
401(k) loans
If you need cash, many employers allow you to take a loan from your 401(k). You can typically borrow the lesser of $50,000 or 50% of the vested balance of your account, according to the IRS. You generally have five years to pay the loan back at a rate of 1% to 2%, plus the prime rate, currently 6.75%. However, you pay the interest back to yourself, rather than a bank.
But tapping your retirement savings for money is a big risk, financial experts say — especially if you're worried you might be laid off.
That's because, should you leave your job, either voluntarily or because of a layoff, the entire balance of the loan comes due by the time you file your next tax return, per IRS rules. Fail to pay it all back, and the outstanding amount is treated as a withdrawal, meaning you'll owe income tax on the amount, plus a 10% early withdrawal penalty if you're under age 59½.
"You have to be careful," says Larry Luxenberg, a certified financial planner with Lexington Avenue Capital Management. "You could be losing money, you could lose your job and you could owe income tax, all at the same time."
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