How to Negotiate a Severance Agreement So You Get What You Want?

Have you ever felt regret after losing employment due to no fault of your own? Do you feel you were cheated when negotiating your last severance agreement? Worry no more. This article is just for you. By the end of this article, you will know what severance agreements are and how to negotiate them. 

What is a Severance Agreement?

This is a written contract between the employee and the employer. It includes details of the compensation package that would be received by the employee on termination of his/her contract. It can be used as an act of goodwill towards the employee. When engaging support like WRG business lawyers, employers often use this agreement to prevent lawsuits in the future.

As an employer, you may not have the full knowledge about creating a severance agreement. In such instances, business lawyers are your best bet. Professional business startup lawyers have dealt with this kind of agreement over time. They’ll know how to tailor the perfect agreement for your business in accordance with state and federal laws.

What do Severance Packages Include?

Now you have a grasp on what a severance agreement is. It’s time to explore the different things included in the agreement. Some benefits are more likable than others.

1. Insurance Coverage

Some insurance companies offer the benefit of extending your health insurance plan. Although this used to prove expensive for the employee, the American Rescue Plan Act of 2021 largely subsidized the fee required. 

2. Non-Compete Clause 

Some companies ensure that the employee signs an agreement stating that they will not work for a direct competitor. This clause is usually for a certain period of time. Business startup lawyers generally include this clause to ensure secrets are not revealed.

3. Confidentiality Clause

This clause usually stipulates that the terms of the contract should not be revealed to anyone. It would be wise for the employee to negotiate some disclosure for his/her lawyers. 

4. Severance Pay

This part of the contract would stipulate how much the employee is to receive on termination of his/her contract. It usually includes how much the employer will pay for unused leaves and vacation times.

How Employees Should Negotiate with Employers During Severance Agreements?

Let us see how employees should negotiate with employers during severance agreements. Many employees do not receive the best agreement possible. A reason for this is a lack of technical know-how on such contracts. A business lawyer would come in handy when signing the agreement.

1. Do Not be Hesitant to Wait Before Signing the Agreement

A common mistake made by employees is to quickly sign the agreement because they want the job. Wait before signing any paperwork!

Businesses want the layoff process to be as painless as possible. As a result, they may try to persuade you to sign your severance agreement right away. You might just want to get through an unpleasant layoff meeting as quickly as possible. It is in your best interests to delay signing any paperwork.

Strong emotions can make making the best financial decisions difficult. So, take a moment to process your feelings about being laid off. Several employees have legal protections that allow them to consider their severance package for a set period of time. So, before consenting to a severance package, ensure that you investigate your rights.

2. Bring in Legal Counsel

The importance of bringing in someone with experience cannot be overstated. A business lawyer can look through the whole document and ensure that you are following state law and that your interests are looked after. A good lawyer will make sure the employers do not terminate your employment based on discriminatory reasons. 

3. Know What the Pay Means

Employees offer severance packages expecting something in return. This could be in the form of a noncompete clause. It could also be in the form of a confidentiality or nondisparagement clause. Knowing what these clauses mean is essential. This would enable you to be conscious of what you can and can’t do after your contract has been terminated. 

Read everything thoroughly. A severance package is a legal document, read it carefully. Take the time to read through the entire document multiple times to ensure you understand every detail. Organize the major components of your severance package and browse unfamiliar terms. Pay close attention to any missing or ambiguous information to prevent consent to any misleading loopholes.

4. Take Advantage of Your Success

Leveraging your effectiveness and accomplishments is one of the most important aspects of bargaining with an employer. Remind your employer of how your hard work and loyalty benefited their company. Using your success to convince your old employer that you merit a better severance package or other benefits is critical. 

You can prove your worth and remind employers that your severance package needs to match your profound contribution to their business. Persuade your company with a list of justifications for why you’re requesting a better severance package.

5. Severance Should be Paid in Lump Sum Upfront

As you are no longer employed at the company, you should negotiate to get your money in full at once. This is the better option as you will be able to quickly sort bills and plan for the future with the pay in hand. 

It is also a good idea because you may not be aware of how good your former employees are doing financially. This is to ensure that you receive your payment even if the company may not have the finances in the future

Choosing the Right Lawyer

You now know the steps to take to negotiate a good severance agreement. The next thing to do will be to hire good legal counsel. Here are some of the few things to note on your journey to find the right lawyer.

1. Create a List of Business Lawyers

This is the first step. You should create a list of lawyers you think are capable of negotiating the agreement in your best interests. You can compile a list from the bar association in your state. 

2. Verify their Licenses

This is to ensure they are well within their rights to represent you in the negotiations. It won’t be good to start scrambling to get an eligible lawyer at the end of the negotiations.

3. Interview and Make a Decision

This is where you interview all the candidates and choose the one who you feel is most qualified to bring you the agreement you want. 


Navigating the negotiations of a severance agreement no longer has to be hard. With the steps above, you can be sure that your employers will have a hard time pushing you over during the negotiations. Your lawyer will ensure due process is followed and your interests are preserved. Good luck in your future negotiations.

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