x% of my paycheck has gone towards ESPP since July. My intention was to sell the vested stock immediately for a short-term profit this time around. The date of purchase is October 31st. If I get laid off in the middle of October, what happens to that x% skimmed from my paycheck? Does it get vested still during the duration of the severance? Does it get sent back to me as a lump sum?
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There is a MyHR article about this. It goes into great detail.
You will still be on payroll and will receive the shares since you still have the benefits. Cancel it immediately after that though. That is when you are just giving them a no interest loan.
@gzm+1oRbcClR agree.
Just to be clear, you are asking about ESPP, where you specify a percentage of your paycheck to purchase Schwab stock at 15% discount at end of October? Because there is no "vesting" involved. Once purchased they are your shares, and you can cell at anytime. This is different from ESOPs, where you are either awarded RSUs or Stock Options, which does have a vesting period (typically 4 years, vesting at 25% increments).
So assuming it's ESPP, if we are layed off in October, you will still get your purchase at end of October, as you are effectively still on the books and continue to receive all benefits including a normal paycheck for 60 days.
If, you were layed off, and the purchase period was past the 60 days, then they would simply refund you what they have taken out for ESPP purchases.
I read the rules on Schweb. It’s bullsh-t. You just gave the company a free 3 month loan if you get terminated or leave before the purchase date as you only get your money back.
It will be vested