In the event that your position is eliminated or you are terminated from your position for another reason, many companies will offer a severance package in exchange for you executing a release of all claims that you have or may have against your employer. Severance agreements almost always bar employees from bringing a lawsuit against their employers for claims such as employment discrimination, sexual harassment and payments owed such as bonuses. Therefore, it is important to review the severance agreement and the terms of termination to determine if any claims exist prior to signing.
If you are being terminated, or even if you hear that layoffs or termination are possible, you should obtain copies of all company policies regarding severance, speak with colleagues regarding what severance has been paid to others and consult with an attorney to discuss what can be done to improve your employment situation. Good preparation can improve potential severance agreement negotiations.
It is common for employers to provide at least a 21 day period of time in which you may consider the agreement and then a shorter period of time (frequently up to 7 days) in which to revoke your severance agreement. These waiting periods are designed to prevent employees from entering into a severance agreement and then arguing that they were forced or pressured into signing.
In the event that a large number of employees are being laid off, you may be entitled to at least 90 days WARN ACT notice, or the equivalent in severance pay. When attempting to negotiate for additional severance, it is important to evaluate the potential claims that you may have against your employer.
If you have been provided with or expect to be provided with a severance package, contact us so that it can be reviewed by an experienced employment lawyer who can explain the benefits and obligations it imposes. Learn your rights before you potentially release and waive all your claims against your former employer.