A severance agreement is a legally enforceable agreement between you and your employer. You can negotiate it before or in case of exit. Once you have signed the contract, you will forego any chance of suing the employer in the future. Always use a lawyer to make sure you know what you`re getting. A lawyer may have a very different opinion about the agreement, your claims and your leverage during the negotiations. If a lawyer finds that you have a legal right to increase the amount of severance pay, it takes about ten (10) minutes to declare the agreement. If the lawyer finds that you have the right to assert rights, the time to conclude a severance pay may take between two and four weeks, depending on the circumstances. Above all, you have to remember that this is a transaction where you invest time and money, not emotions. There is a risk in any severance negotiation that you end up with what was originally proposed, but you will not know until you make a written claim for more severance pay.
Your investment in the lawyer`s time to verify and negotiate the agreement can have huge payments in the form of higher billing, much more than what you paid in legal fees. A company may be required to pay severance pay under the employee`s employment contract, the WARN act or its state equivalent or company policy. Although the company is not required to pay severance pay, it will often offer severance pay in exchange for various agreements of the dismissed employee, including the release of any claims against the company (see below). An executive has the best chance of negotiating severance pay if the employee has been dismissed for no “reason,” as defined in an employment contract. There are a number of important legal and economic issues that should be taken into account when negotiating an employment agreement. If you are over 40 years old and the company offers you a compensation package, the company must give you at least 21 days to review it and 7 days to revoke the package. It will often be advisable to consult a lawyer who is an expert in solving these problems. And your ability to obtain severance pay or additional benefits depends on any bargaining leverage and any potential claims against the company you may have. That is where the informal guidelines come in.
The basic rule that applies to severance pay – two weeks` salary for each year of employment – is an overall average. In practice, it is between one and four weeks depending on the situation, says Jeffrey M. Landes, a lawyer in the practice of labour and work at the New York law firm Epstein Becker and Green. This comprehensive guide will guide you in detail on the different parts of your compensation package in order to better understand the agreement you want to sign. It is precisely during a merger or a change of direction that companies often lay off several employees at the same time. Compare your package with offers received by other former employees to determine if your offer is fair and if you can negotiate for more. Companies sometimes offer the services of an outplacement company free of charge. Such outplacement companies can help you find a new job or position yourself for a career change. Ask yourself if the company will include it as part of your severance package. Alternatively, you can request a cash effort to hire an outplacement company of your choice (or just keep the money in cash). This is usually a benefit ranging from $10,000 to $25,000.