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Severance Agreements

Are you leaving your job and your employer just handed you a severance agreement and release of all claims? 


Or are you contemplating leaving and hoping for an agreement? 

Doorways Employment Law regularly reviews, drafts and negotiates severance agreements (also called separation agreements). What an employee can hope to gain in severance negotiations typically is proportional to the strength of an employee's legal claim(s); therefore, it is important to meet with an attorney to assess if there are any legal claims.

In addition to talking about what led to an employee's separation from employment, some of the topics to discuss would likely include:  

  • Severance pay – how much is it? When is it paid? How is it paid? What are the legal claims the employee is releasing in exchange for the payment?

  • Health insurance -- it is continued? For what period of time? Is the premium subsidized over the same period? 

  • Retirement contributions -- are these made? For what period of time?

  • Unemployment -- given the circumstances of the employee's separation from employment, is the employee on a path to unemployment eligibility?  

  • Return of property -- does the employee still have property on the employer's premises, or does the employee have the employer's property? 

  • Employment references -- what happens if and when a prospective employer of the employee contacts this employer? What about a potentially negative reference?

  • Nondisparagement clause -- is there a clause in a proposed draft that protects the employee from disparagement or is it solely focused on protecting the employer? 

  • Confidentiality clause -- is there a clause that prohibits any discussion of the agreement? Would the employee prefer to be able to discuss the terms openly? 

Severance agreements, particularly to the extent they include a "general release" or "release of all claims," have significant consequences. To the extent an employee receives one, it is generally advisable to go over it with an employment lawyer in order to understand the implications of each provision and discuss possible avenues for maximizing the employee's interests. Contact Doorways Employment Law for a severance agreement review. And consult the blog for more on severance agreements. 

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