If you’re wondering ‘should I have a lawyer review my severance agreement,’ the short answer is yes. A severance agreement lawyer can clarify the implications, safeguard your legal rights, and negotiate improved terms for you. This article explains why getting legal advice is crucial and what you should look for in your severance agreement.
Key Takeaways
- Having a severance lawyer review your severance agreement is crucial to protect your legal rights, identify unfair terms, and maximize severance pay and benefits.
- Severance agreements often contain restrictive clauses such as non-compete, confidentiality, and non-disparagement clauses that can impact your future employment opportunities and legal rights.
- Before signing a severance agreement, it’s important to thoroughly read and understand its contents, seek legal consultation, and consider negotiating better terms to ensure a fair and favorable outcome.
At Levine & Blit, our award-winning New York employment lawyers are ready to put their extensive experience to work for you. Whether it’s negotiating employment or severance agreements, our team will thoroughly review the terms offered by your employer, identify any violations of federal or state employment laws, and, if necessary, negotiate a better agreement on your behalf.
Don’t settle for less—contact us today at 646-461-6838 to ensure you receive the fair treatment you deserve.
👉Also Read: Maximizing Your Rights: Why Signing a Severance Agreement Matters in Employment Law Cases
Understanding Severance Agreements
A severance agreement is a legally binding contract outlining the terms and conditions of your departure from a company. These agreements are designed to protect the employer’s interests while also offering some benefits to the employee, such as severance pay and continuation of benefits. Keep in mind, these agreements, while signaling the end of your employment relationship, also introduce new legal obligations and restrictions.
What is a Severance Agreement?
A severance agreement is a contract that outlines the terms and conditions of an employee’s departure from a company. This document specifies the conditions under which you will leave, including any severance pay, benefits, and other compensations you may receive. In employment termination scenarios, this document is pivotal as it shapes your future legal and financial situation.
Key Components of Severance Agreements
Several key components typically make up severance agreements. These often encompass severance pay, continuation of benefits such as health insurance, and outplacement assistance to help you find a new job. Additionally, these agreements may require you to agree to future obligations, such as non-compete clauses, that could impact your ability to work in your field. Grasping these components before signing any agreement is paramount.
👉Also Read: Decoding Severance Package: What Every Employee Should Know
Why You Should Have a Lawyer Review Your Severance Agreement
Having an attorney to review severance agreement, which is a type of legal contract, before signing is of paramount importance. A thorough review can identify potential pitfalls, ensure fairness, and verify that the terms comply with relevant laws.
Severance lawyers can assist in negotiating the terms of the severance package, including monetary compensation, continuation of benefits, and non-compete clauses. These aspects can substantially shape your financial and employment situation in the future, making it crucial to negotiate severance agreements effectively.
Protecting Your Legal Rights
Consulting an employment attorney primarily serves to safeguard your legal rights. When signing a severance agreement, you might unknowingly waive significant rights granted under state and federal law, such as the right to sue your employer for discrimination or harassment. An employment lawyer can help ensure you don’t waive these important rights and can assess the agreement for compliance with all applicable laws. Some reasons to consult an employment attorney include:
- Safeguarding your legal rights
- Assessing the agreement for compliance with all applicable laws
- Avoiding unknowingly waiving significant rights
- Getting advice on the best course of action
This is especially important for employees over 40, who enjoy specific protections under the Age Discrimination in Employment Act (ADEA).
Identifying Unfair Terms
Employment attorneys excel at:
- Identifying and negotiating unfair terms or restrictive covenants potentially affecting your future employment opportunities
- Identifying potential pitfalls in the severance agreement, such as non-compete or non-disparagement clauses, ensuring that these do not violate your rights
- Reviewing the agreement carefully to help ensure that the terms are fair and reasonable
Maximizing Severance Pay and Benefits
A lawyer proves invaluable in maximizing your severance pay and benefits. They can:
- Use potential claims as leverage in negotiations to increase the settlement amount
- Help ensure that the severance package is fair
- Maximize all monetary compensations and benefits to reflect your years of service and level of responsibility.
This can include not only severance pay but also the continuation of benefits and other compensations.
👉Also Read: Securing Your Future: The Role of Law Offices in Severance Agreement Signings
Common Clauses to Watch Out For
Severance agreements often contain clauses that need careful consideration. In most severance agreements, these clauses can significantly affect your future, making their comprehension vital. Be wary of common clauses like non-compete clauses, confidentiality and non-disparagement clauses, and release and waiver of claims.
Each of these can profoundly impact your career and legal rights.
Non-Compete and Restrictive Covenants
Non-compete clauses can drastically hinder your ability to secure new employment or launch your own business. These clauses may prevent you from:
- Working in your career field for a significant period
- Pursuing opportunities that align with your skills and experience
- Earning a living and supporting yourself financially
- Advancing your career and professional development
This can lead to financial problems or career derailment. It’s essential to propose changes to these restrictive clauses to ensure they are reasonable and fair.
An attorney can provide advice on the requirements of non-compete agreements and how they might impact your job opportunities.
Confidentiality and Non-Disparagement Clauses
Confidentiality and non-disparagement clauses are commonly found in severance agreements and need careful consideration. These clauses should not limit your rights to disclose the conditions of your employment or the circumstances surrounding your termination.
The purpose of a non-disparagement clause is to prevent you from making negative statements about your former employer, including on social media. An attorney can help negotiate these clauses to ensure they are fair and do not infringe on your rights.
Release and Waiver of Claims
The release and waiver of claims clause in a severance agreement is critical to understand. Typically, this clause requires you to waive your rights to sue the employer. It also releases them from liability. It’s important to be aware of the specific legal claims you might be waiving, such as those related to discrimination or unpaid wages.
Understanding the terms helps in recognizing if the agreement includes a waiver of legal rights that might affect future claims. A too-broad release may cause you to give up key legal rights unknowingly.
👉Also Read: Maximizing Your Rights: Why Signing a Severance Agreement Matters in Employment Law Cases
Evaluating the Financial Aspects of Your Severance Package
To ensure you receive fair compensation, it’s vital to evaluate the financial aspects of your severance package. Here are some key factors to consider:
- Severance pay calculations typically reference your years of service, and the manner of payment can vary.
- Assess the severance pay structure, including any additional benefits or incentives.
- Consider the duration of health insurance continuation and any associated costs.
- Take into account any outstanding payments, such as unpaid wages and bonuses.
Assessing these factors will help you understand the financial implications of your severance package and make informed decisions during your severance package review.
Severance Pay Structure
Severance pay can be offered as a lump sum or in installments. While a lump sum payment provides immediate financial relief, it may affect your tax bracket. Alternatively, installment payments can be taxed at a lower rate and may limit access to unemployment benefits.
The manner of severance payments is negotiable, and it’s important to choose the option that best suits your financial situation.
Health Insurance and Other Benefits
Health insurance continuation is a significant component of severance agreements. Under COBRA, you can continue your health insurance coverage, but you will have to pay the full premium. It’s essential to negotiate an extension of employer-paid health insurance as part of the severance benefits. Details of how the health insurance continuation will be accomplished should be clearly outlined in the agreement.
Additionally, ensure that any accrued vacation and sick pay are included in the severance agreement.
Outstanding Payments and Bonuses
Make sure that all outstanding payments and bonuses are included in the severance agreement. Document any expenses owed to you, including unpaid wages and bonuses, and ensure these are recognized in the agreement. Be sure to document any owed expenses or pending bonuses in writing and provide the documentation to your employer. This will help ensure that you receive the proper compensation.
Employers are not required by law to provide severance pay unless it is specified in the employment contract or company policy.
Steps to Take Before Signing a Severance Agreement
To protect your rights, take several important steps before signing a severance agreement. Thoroughly read the agreement, seek legal consultation, and consider negotiating the terms.
Thoroughly Read the Agreement
Thoroughly reading the severance agreement can help identify any ambiguous language that could potentially lead to misunderstandings. Unclear or ambiguous terms can result in unintended breaches of contract. It’s important to verify the specific time length given to review and sign the document.
If you feel pressured to sign quickly, this may indicate an attempt to take advantage of you. Make sure your decision is based on knowledge, not desperation.
Seek Legal Consultation
If presented with a severance package, seeking advice from an experienced employment lawyer to safeguard your rights is recommended. They can guide you on the fairness of the package and assist in negotiating better terms if required. An employment lawyer can ensure your employer complies with the law and help negotiate better terms on your behalf. Discuss any concerns about workplace discrimination with your attorney, as this can impact negotiations. In such cases, seeking assistance from experienced New York employment lawyers can be beneficial.
Negotiation Tips
Highlight your contributions to the company as leverage for negotiating better terms in your severance package. Consider negotiating severance pay, insurance coverage, and job search assistance in your counteroffer.
Severance attorneys can help negotiate a better deal than the one offered by your former employer.
👉Also Read: Crafting Fair and Equitable Severance Packages: Levine & Blit’s Best Practices
Contact Levine & Blit Law Firm for Expert Advice
If you’re unsure about any aspect of your severance agreement, contacting Levine & Blit for expert advice can be a game-changer. Our team comprises award-winning New York employment lawyers who specialize in:
- Negotiating employment and severance agreements
- Evaluating if your severance agreement’s terms breach federal or state employment laws
- Negotiating more favorable terms for you
Free Case Evaluation
Levine & Blit offers a free case evaluation to review severance agreements and help employees understand potential legal ramifications before signing. You can schedule a phone evaluation with our New York City employment law attorneys to discuss your severance agreement.
This initial consultation can provide critical insights into your agreement and the best steps to take next.
Experienced Employment Lawyers
At Levine & Blit, our attorneys possess extensive knowledge of federal and state employment laws, enhancing their negotiation skills. They are renowned for helping employees secure better severance packages that reflect what they truly deserve. Understanding your rights and obligations, having your agreement reviewed, and receiving personalized guidance are crucial steps that Levine & Blit can assist with.
To find out how our expertise can benefit you, reach out for a free case evaluation with one of our New York severance lawyers. Call our firm today at 646-461-6838 or contact us online to get started.