Mark Law Firm Recent Articles

Offered severance? An attorney will protect your rights.

Posted by Jamison Mark on Feb 27, 2015 4:06:15 PM

Leaving a job can be tumultuous, particularly if you’ve been laid off. If you’ve been offered a severance package, it can be tempting to just sign the offer letter as presented and alleviate some of the financial stress while you search for new employment. Doing so, however, could put you in a far worse position as you move forward in your career – these packages typically contain agreements that restrict your rights and can limit your future job prospects. An attorney can often negotiate to rewrite or remove unfavorable language, or to obtain a larger compensation package in exchange for retaining it.

New Jersey Attorneys can protect your rights 

You have a right to have an experienced attorney review your severance offer, and here’s why you should:

  1. You may already be entitled to money. Your employer must pay you wages you have already earned or are owed (for example, if your company pays out earned vacation or bonuses upon termination of employment, or if your employment contract has specified a certain amount of payment). If you are part of a union or subject to a collective bargaining agreement, you may be covered by provisions ensuring severance payments in case of a layoff. If you are already owed money for wages or severance under such an agreement, you don’t have to sign a severance agreement to get that money.
  1. An attorney can tell you if the amount offered is reasonable. An experienced employment attorney has the legal expertise and experience to evaluate whether your offer is reasonable. He or she will be able to tell you whether what you’re being offered is typical for your industry and position, and help you negotiate if you are being underbid.
  1. You can negotiate your future rights. One of the most important reasons employers ask for severance agreements is to obtain a release by the employee of all legal claims against the employer. An attorney can help you negotiate a more limited and balanced release, which protects claims you might have including, for example, your right to seek unemployment insurance benefits uncontested by the employer. Other claims you may fight to retain include claims under COBRA (related to your continuing health benefits); claims which may arise related to pension benefits, stock options, etc.; the right to take legal action to enforce the severance agreement itself; and any right to indemnification (legal protection against claims from a third party) by the employer.
  1. You can negotiate your future relationship. Your employer may ask that you refrain from speaking badly about it (a “non-disparagement” provision), and you have the right to ask for the same, or to specify how references will be handled and provided to future employers. Also, severance agreements frequently include language that an employee will “cooperate fully” with any legal proceeding or investigation involving the employer. Depending on your industry, this possibility could require an unreasonable amount of future, uncompensated involvement in litigation. If this seems likely, an attorney can negotiate to scale back this provision to “reasonable” cooperation, accounting for your convenience and compensation.
  1. You can limit restrictive covenants. Whether you are already bound by non-solicitation or non-compete agreements or they are presented in the severance offer, an attorney can negotiate to make them as limited in scope as necessary to protect the employer without unreasonably limiting your ability to move forward in your career. Frequently, the offer will include broad restrictions on your ability to work in your chosen field that are unreasonable in time and geographic scope, or prevent you from using your knowledge and skills. An experienced attorney can negotiate on your behalf to make sure your rights are protected.

Severance agreements are often long, complicated documents designed to protect the company’s rights rather than an employee’s. During this already-difficult time of transition, it’s important to have knowledgeable counsel on your side. An attorney experienced in employment law and severance negotiations can help you understand what you’re being offered and protect what’s important to you – you don’t have to do it alone. Contact us to set up an appointment to review your severance offer today.


Download the FREE Guide:  How an Employment Attorney Can HELP YOU  

Topics: Employment Law

The information on this website is made available by the Mark Law Firm for educational purposes only. It is intended to give a general understanding of New Jersey law, not to provide specific legal advice. Use of this website does not establish an attorney-client relationship between you and the Mark Law Firm and should not be used as a substitute for legal advice.