Negotiating a Severance Package

Layoffs have been commonplace lately. The healthcare and IT industries have been hit hard in recent years, so to save money, many companies are laying off workers. This means companies have been busy drafting legal documents such as severance agreements.

It can be hard to suddenly be forced to leave a company, so employers often offer severance packages. They typically come with financial compensation and possible extended benefits, such as health insurance, to help support the laid off worker for a limited period of time.

While most laid off employees simply accept the severance agreement they are given, it may be worth it for some to negotiate. Most employees don’t feel as though they have this option, though, as they are often pressured by HR to sign and return the agreement as quickly as possible. However, with some agreements multiple pages long, you may want to consider reviewing the document carefully.

As an employee, you want to make sure you understand your rights. As an employer, you need to expect that an employee may try to discuss the agreement with you and possibly negotiate certain aspects of it with you. Here are several key aspects that should not be overlooked.

Pay

Severance package compensation can vary based on your salary and length of time at the company. Negotiating can help you leverage other factors such as unused vacation days and sick time, but you may have to involve a lawyer, as HR may not agree. If you are a union worker, you may be entitled to certain benefits in the event of a termination, so check your contract.

In the event of a mass layoff, the Worker Adjustment and Retraining Notification (WARN) Act entitled you to a severance package, so make sure you get one if your layoff falls under this.

Noncompete Agreements

Some companies may throw in noncompete agreements in a layoff. These restrict you from working for a competitor after leaving a job and can really limit your career moving forward, especially if you work in a niche industry. Noncompetes go by state law, so make sure you understand any noncompete clauses in your severance package.

Neutral References

When you’re not leaving a company on the best terms, it may be a good idea to ask for a neutral reference. This is when an employer agrees to provide only basic information to prospective employers, such as the dates of employment and your position. This arrangement can prevent potential employers from receiving negative feedback that could impact your future career.

Learn More About Business Contracts

Whether you’re a company laying off workers or you’re one of the laid off workers, you’ll want to make sure the severance agreement is sound.

Let Orlando business contracts lawyer B.F. Godfrey from Godfrey Legal review your contract to ensure it’s legally sound. We can also assist you with negotiations. Schedule a consultation today by filling out the online form or calling (407) 890-0023.

Source:

fastcompany.com/91227185/dont-sign-your-severance-agreement-until-you-negotiate-these-3-points