There are important factors to consider when deciding to offer a severance package to an executive of a company. For example, creating a legally binding waiver to prevent employees from initiating a lawsuit should not be ignored. However other considerations include provisions on proprietary information and restrictive covenants. We have experience in drafting severance agreements to incorporate the legal complexities involved in terminations.
Severance agreements almost always bar employees from bringing a lawsuit against employers for claims such as employment discrimination, sexual harassment and payments owed such as bonuses.
It is often recommended for employers to provide at least a 21 day period of time in which to permit its employees to consider the agreement and then a shorter period of time (frequently up to 7 days) in which to revoke the 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 it.
In the event that a large number of employees are being laid off, an employer may be required to notify its employees in advance, pursuant to the WARN ACT notice.