If your employer is voluntarily giving you some sort of severance pay, then that's what your employer is doing.

You have not shared enough information for us to comment on what your employer might mean by "If I don't keep paying you it's an issue".

What hearing are you talking about? Should we infer that youmade wage complaint with the state, and that you have an upcoming hearing on your wage complaint? If you have made a wage complaint, did your employer actually say, "I'm firing you for making a wage complaint"? If not, what reason(s) did your employer give for firing you?