The worst thing you can receive from your employer is a termination letter. And along with this letter, some employers do offer a severance package.
New York is an at-will state; therefore, it does not require employers to offer a severance when they terminate an employee. However, some employers offer this package to prevent any legal issues after firing an employee.
While a severance agreement after the termination of your employment may seem like a good deal, it usually isn’t in your favor.
Has your employer offered you a severance? If yes, the next step you should take is to avoid signing it right away. Contact Levine and Blit to review the agreement to ensure it offers all benefits you deserve and does not impact your future employability.
This article will tell you about the steps to take next when you receive a severance agreement from the employer. Moreover, we’ll tell you more about a severance package and why you should avoid signing it without consulting your lawyer.
What is a Severance Package?
A severance package or agreement outlines the pay and unemployment benefits offered to an employee after the termination of their employment. The package may also include severance payment based on years of service or cash payment for unused vacations. Bonus payments and stock options can also be a part of this agreement.
In exchange for receiving the severance benefits, the employee will require to sign the severance agreement. This contract typically contains clauses that require the particular employee to release any claims they might have against the employer.
Furthermore, the agreement may also bind the employee legally, such as preventing them from joining the employer’s competitor and sharing proprietary information.
Why Do Employers Offer Severance?
The biggest reason employers in New York offer severance despite having no obligation to offer it is because they want to avoid a future lawsuit by the employees. The second reason is attracting top talent from the industry, as some employees prefer favorable severance packages while joining an organization.
Usually, the severance pay is in favor of the employer, and that’s why employment lawyers encourage the employees not to sign it without consulting them.
6 Steps You Should Take After Receiving a Severance from Your Employer
A severance package might look very lucrative after your employer ends the employment. Most employees agree to these packages, thinking that it’ll support them in the hard times while they’ll get enough time to look for another job.
However, it is not advised to agree to the severance right away. Below are some steps you need to take after your employer offers you a severance agreement.
Remain Calm and Refrain from Asking Questions
Try to avoid reacting to anything after receiving the severance agreement. Do not argue with the HR manager or your boss over the agreement and the terms mentioned in it.
Also, it is recommended to avoid asking any questions to the employer. Collect the documents, and tell them that you need some time to review the agreement.
As per law, workers of age 40 or above get a window of 21 days to review and sign the severance package. In the event of a mass layoff, you get a window of 45 days. So, there’s no need to rush, as you have got plenty of time.
Determine the Reason for Your Termination
Review the termination letter carefully, and determine the reason for your layoff. If you suspect that your employer has laid you off because of your age, sex, or on based on other types of discrimination, the New York employment law gives you the right to file a lawsuit with the EEOC against your employer.
Additionally, if the termination of employment is a result of retaliation because you reported some unlawful activities, it is also against the law.
Do you think that your employment termination is against the law? Contact Levine and Blit at 866-392-2661 to get the facts evaluated, and we’ll help you file a charge with EEOC if your termination is a result of discrimination or retaliation.
Employees that have signed the severance agreement may not be able to file a lawsuit against their employer. Typically, these agreements have a clause that prevents the employee from suing the employer. Speaking to an expert employment lawyer in New York is highly advised to know what to do next if you have agreed to the severance package.
Review the Agreement Carefully
Go through all the details mentioned in the agreement carefully, and determine if it omits insurance coverage, benefits, and other sources of compensation. Furthermore, you should compare the severance packages to other standard severances offered in the industry.
Look at the payment schedule, and check if you’ll receive a lump sum severance payment over a period of time. The agreement should also mention when to expect the payment.
Gather all Employee Information
Collect all essential employee information such as the employment manual, original offer letter, vacation time, and your employer’s severance plan to determine if you have any grounds to negotiate.
Determine Whether to Negotiate or Not
In many cases, the severance packages are negotiable, and that’s why employers list fewer benefits in them when offering severance to workers. Whether to negotiate or not entirely depends if the severance pay is reasonable.
If you decide to negotiate, you need to determine the terms to negotiate, such as wages, continued health insurance, stock options, and more.
Hire a Severance Agreement Attorney
It is indispensable to hire a severance agreement attorney after your employer lays you off and you think it is a result of discrimination or retaliation. The lawyer will help you evaluate your options, such as filing a lawsuit with EEOC against the employer.
In addition, the lawyers will help you negotiate the severance pay with the employer so that you receive all the employment benefits you deserve.
Contact Levine and Blit if you suspect wrongful termination. Moreover, our expert severance agreement lawyers will help you review the agreement and negotiate its terms with the employer.
Call us at 212-967-3000 for a free case evaluation and to hire the best severance agreement attorneys in New York.
5 Reasons Why You Should Avoid Signing a Severance Agreement Without Obtaining Legal Advice
We understand the pressure you may go through after your employer calls off your employment or terminates you. However, signing the severance agreement is something you should avoid at all costs.
Your boss may force you to sign the documents and accept the offer, but New York law gives the employees full freedom to accept or reject a severance pay. Below are some reasons why signing the severance package immediately after receiving it is the worst thing one can do.
The Employers Protect Themselves, and Not You
A severance package is an agreement usually drafted by the company’s lawyers, meaning it contains terms and clauses that are beneficial for the employer. In some situations, a severance pay can be a wholly one-sided document drafted to protect the employer from you taking legal action at the lowest possible cost.
Furthermore, these agreements contain a Release that a worker needs to sign in return for employment benefits. A Release is a legally-binding contract that waives your right to sue the employer.
These Packages Can Also Have Mistakes
Humans tend to make mistakes, and these mistakes can be present in a severance agreement as well. Even when drafted with the utmost care, some errors do occur.
At Levine and Blit, we have reviewed several severance packages for our clients, and some of them had mistakes that could otherwise have affected the employee’s entitlements. If you sign the severance package without getting it reviewed, you’ll agree to all the mistakes it contains, and that can impact your employability.
The Timelines Are Not True Always
One reason why most employees quickly accept the severance pay is the stringent deadlines. However, these deadlines are not set by the employers, but the New York employment laws control them.
Providing tight deadlines is often a tactic of employers to pressurize the employee to sign the severance package.
It’s Not About Money Only
While the financial components of a severance pay hold significant importance, they aren’t the only benefits you deserve. A severance agreement should include several things, such as tax benefits, continued health insurance, pension rights, and much more.
It’s One of the Biggest Transactions of Your Life
Especially if you have served your employer for a long duration, the severance package can be a massive transaction. So, it does not make sense to sign the agreement right away without reviewing what it contains.
Moreover, termination of employment can be a stressful time, and you should avoid making any big decisions without consulting your attorney.
Top Reasons to Hire an Attorney for a Severance Agreement
Now that you know why it’s essential not to sign or accept the severance agreement right away, it’s essential to know why you need an attorney for it. A severance agreement lawyer will not only help you with reviewing the agreement, but they’ll ensure that the agreement does not affect your future employability.
Here are some reasons why you should have a professional lawyer by your side after receiving severance from your employer.
Payment and Benefits
If a worker is entitled to receive severance pay upon termination of their employment, there is no need to sign an agreement for receiving the payment. However, a professional attorney will help you determine if the payment and benefits offered in the agreement are in order.
Unreimbursed expenses and unused vacation time could also be a part of the severance agreement. An attorney will help you evaluate the grounds you can use to negotiate with the former employer.
The severance agreement should explain all benefits the worker will receive upon separating from the company, such as the continuation of health insurance. With the help of an attorney, you can determine if your employer is terminating your health coverage too.
Similarly, the attorneys will help you understand other employment benefits that you deserve but are not mentioned in the severance agreement.
Sometimes, employers or their attorneys commit some oral promises such as cash benefits and more in order to make you sign the severance agreement. However, any promises that are unwritten are not valid as per the law, and your employer is not legally obligated to offer you the under-the-table perks.
Your attorney will ensure that the agreement outlines all the benefits your employer has promised. Also, if a lawyer reviews the agreement, you can rest assured that the promises will be enforceable.
Non-Disparagement and References
Severance agreements usually contain a clause that bares the employee from disparaging the former employer. When you hire an attorney to review the severance agreement, your lawyer will negotiate how references will be handled and the information that will be provided to potential future employers.
Some severance agreements often require the workers to cooperate fully with all investigations of legal proceedings the employer requires. With the help of a severance agreement lawyer, you can negotiate to scale back this provision by changing the “full cooperation” to “reasonable” cooperation.
While your attorney will also help you add a clause in the agreement that requires the employer to provide you the right to sufficient notice of the need for cooperation.
Contact Levine and Blit for All Severance Agreement-related Issues
Have you received a severance from your employer? Is your employer forcing you to sign the agreement? Severance agreement lawyers at Levine and Blit can help you with reviewing the agreement and negotiating the terms with the employer.
Moreover, we’ll evaluate the possibility of a wrongful termination while helping you with the legal proceedings. To date, we have reviewed numerous severance packages for our clients, and our attorneys are well aware of how employers play with terms and conditions when offering severance to their workers.
Call us at 212-967-3000 for a free case evaluation and to appoint the best severance agreement lawyers in New York for your case.