Severance Pay and Agreements

Severance Pay

Jacksonville Severance Agreement Attorneys - Separation Agreement.

Executives and employees leaving a company are subject to considerable risk when they lack an effective severance agreement. When income, reputation and the future of your career are involved, it is essential to have an experienced employment law attorney protecting your interests.

Companies seek to have employees waive rights in signing a severance agreement. In order to have the employee successfully waive age discrimination claims, a severance agreement must comply with the Older Workers Benefit Protection Act (OWBPA).

The severance pay lawyers at The Law Offices of Archibald J. Thomas, III, P.A. have experience in dealing with employers on a variety of severance pay issues. These issues vary from case to case and may depend on the needs or requirements of the individual employee. Regardless of whether the situation involves severance pay pursuant to a plan document or contract or whether the payment of severance pay is being made on an individual basis in the absence of a plan or contract, our lawyers have experience in handling all of the issues that are likely to arise during the course of discussions or negotiations leading to the execution of an agreement.

Severance Agreements

Our firm is frequently retained for the purpose of negotiating severance pay from a current or former employer. An employer’s agreement to pay severance pay can arise from a variety of circumstances. Sometimes employers will present a proposed severance agreement to an employee and will provide them several days to review the agreement and to perhaps seek legal counsel to assist the employee in determining whether the agreement is appropriate. Our firm is often retained for the purpose of negotiating new or additional terms to the agreement originally provided by the employer. In some instances, we are retained by employees for the purpose of requesting severance pay from the employer or former employer where no severance discussions have previously taken place. In this situation, it is important to determine whether the employer has an existing severance pay plan or policy. To the extent an employer has an existing severance pay plan, the employer is obligated to provide severance pay in accordance with the terms of the plan document.

However, there is no law prohibiting an employer from providing severance pay that is more generous than the terms required by the plan document. Thus, it is often desirable to discuss any severance pay or proposed agreement with the employer rather than simply accept the initial proposal offered by the employer. On occasion, severance pay may be required pursuant to the terms of an employment contract. If this is the case, a legal claim for breach of contract may arise if the employer fails to honor the terms of the contract. There are many potential terms or parts of a severance agreement that should be considered by the employee. For example, in addition to the payment of severance pay, it is important to determine whether the employee has any significant legal claims that will be waived or released as part of the severance agreement. Generally speaking, claims for unemployment compensation cannot be released pursuant to the terms of a severance agreement or general release of liability. Most employers will insist however that in return for payment of severance pay, the employee must provide a release of liability regarding any potential legal claims.

Other issues that should be considered are such things as how the employer will handle references from perspective employers, the desirability of non-disparagement clauses, whether outplacement assistance is needed, whether the employer would be responsible for payment of some or all of the COBRA payments, any issues regarding the exercise of stock options, and the parameters of any requirement that the employee continued to provide consulting services or assistance in the future.

Our firm is very experienced in discussing these and other issues related to severance agreements with employees and in negotiating these agreements with employers. If you have any questions or concerns regarding severance pay issues, please contact us to schedule an appointment to meet with one of our severance agreement lawyers.