Severance agreements (aka settlement agreements) can be presented to employees by employers in exchange for waiving claims against the employer. Severance agreements are usually presented to an employee at or near the end of their employment.
Depending on the situation, our lawyers can sometimes help employees negotiate for a better severance package. We have been able to help employees negotiate for a severance or settlement even if the employer hasn’t presented a severance yet.
Employers do not need to give their employees severance. However, if the employer has a written policy on severance, which is rare, then in behooves that employer to follow its own internal policy on severance.
The first best step is probably consulting with a lawyer to determine the best strategy for securing a severance. The most important factor is whether the employee has actionable legal claims. If the employee was treated differently because of a protected characteristic, for example, race, religion, disability, medical status, sex, etc., then they might have a valid legal claim or at least some leverage against their employer. Or, if the employee spoke up about illegal activity at work and was retaliated against, they may have a valid legal claim against their employer. Employers are more likely to give severance and be open to negotiating if they are concerned about a valid legal claim that the employee might have.
However, sometimes employers offer severance even if there is no valid legal claim. There can be many reasons for this. The company might be risk averse and want to make sure that departing employees sign a severance agreement where they are waiving their rights against the employer. Or the company may have an unofficial policy of taking care of longer tenured employees who have done a good job for the company.
We don’t believe that there is a typical severance amount. Other law firms may say 1-2 weeks per year of service, or somewhere in that range. In our opinion, severance is very dependent on each person’s unique circumstances. We suggest contacting an attorney to evaluate your ability to get a severance or if already presented with a severance, to evaluate your ability to negotiate for more.
Not necessarily. We strongly believe that in some instances, the best time to start exploring and even negotiating is while you are still employed with the company.