Negotiating a severance package can be a crucial step when parting ways with an employer. Whether you’re facing a layoff, resignation, or mutual separation, a well-structured severance package can provide financial security during your transition to a new job. In this blog, we’ll discuss the key strategies to successfully negotiate a severance package that meets your needs.
Determine if the Company Owes You Any Pre-existing Contractual Obligations
Before entering into any negotiation, carefully review your employee handbook, employment contract, and any other similar document that sets the terms and conditions of your employment. In some cases, these documents may include clauses that detail the terms and conditions of severance pay. Familiarize yourself with the provisions concerning severance to ensure you’re well informed about what you may be entitled to receive.
Talk to A Lawyer and Determine if You Have Any Leverage
Employers are generally not legally required to provide employees with severance agreements. There is no law that says that employees must get severance agreements. Severance agreements are, as the name implies, mutual agreements between two parties.
Stated differently, there must be something to motivate your employer to provide a severance payment. In some cases, gratitude for a job well done could provide the necessary motivation. In other cases, a company policy based on a predetermined formula that applies to all employees across the board can lead to, and/or generate, a severance offer.
More often than not employers will present a severance offer to an employee as a way of buying peace of mind for themselves. Practically all severance agreements include a release and waiver of rights by the employee, as well as an agreement by the employee that he or she will not to sue the company. Simply put, the company is paying money for the peace of mind of knowing that the employee will not sue them.
Overstating the obvious, the bigger of a risk the employee presents to the employer, the larger the severance offer will likely be. In other words, if a company recognizes that it screwed up, or in some way violated the employee’s rights, it will be far more likely to offer a significant severance, as compared to a situation where the company has done no wrong.
One should never manufacture leverage, but if the employee suspects something seriously wrong happened to them while they were still employed, or that the termination of their employment might in some way be unlawful, then the best thing to do is to speak to an experienced employment lawyer and tell them what happened. This will likely be the fastest way to determine if the employee has a case. The employee may at that point decide not to accept the severance and to pursue a case, or in the alternative that information can be developed and presented as a mechanism for increasing the severance offer.
Set Realistic Goals and Practical Objectives
Determine what you value most in your severance package. It could be a lump sum payment, extended healthcare coverage, continued access to certain benefits, assistance with job placement, or even a favorable reference. Knowing your priorities will help you focus on the aspects that matter most to you during negotiations. Bear in mind, however, that the focus should be on what you cannot do without, not anything and everything under the sun.
Review the Fine Print
Once you’ve reached an agreement, review the severance package carefully before signing. Ensure that it aligns with your negotiated terms and any legal obligations. If necessary, consult with your attorney again to verify the document’s accuracy.
Contact Akopyan Law Firm, A.P.C. for Guidance
Negotiating a severance package can be a delicate and complex process, but with the right preparation and approach, you can secure an arrangement that eases your transition into a new phase of your career.
Contact Akopyan Law Firm, A.P.C. for questions on this, or other aspects of employment law. With decades of experience, hundreds of satisfied clients, outstanding results, a complimentary case evaluation, and contingency fees, it’s no wonder why Akopyan Law Firm, A.P.C. is the firm of choice across Southern California.