Severance Agreement Review

Clients Rate Lawyers on our Platform 4.9/5 Stars
based on 4,009 reviews

Jump to Section

Need help with a Severance Agreement?

Post Project Now

Post Your Project (It's Free)

Get Bids to Compare

 Hire Your Lawyer

A severance agreement review is a process of evaluating a contract between an employer and an employee that details the terms of their separation. It may be used by either party to ensure that they are treated fairly during the termination process. You need to make sure that your severance agreement is legally sound. The last thing you want is for your severance agreement to be challenged in court, which can result in costly litigation.

When you work for a company, you enter into an employment contract. The contract may be an oral agreement, or it may be in writing. Regardless of the form, the agreement includes basic compensation and benefits, job description, and working hours. When an employer terminates your employment, it must follow specific procedures to avoid liability under federal and state law as part of the severance agreement.

The severance agreement is one way employers can protect themselves from lawsuits by employees who feel they were wrongfully terminated. Here's what you need to know about severance agreements and how they work.

What is a Severance Agreement?

A severance agreement is a contract between an employer and an employee that provides terms for terminating the employment relationship.

Severance agreements are most commonly used in uncertain situations surrounding whether or not an employer will terminate an employee's employment relationship.

For example, if your employer decides to lay off part of its workforce, it may offer severance packages to those being let go. In this case, it may be useful for employees to negotiate a severance agreement in advance to know their rights should they be terminated.

In some cases, employers may also offer severance packages to current employees looking for new jobs. For example, suppose you're leaving your job because you got a better offer elsewhere. In that case, your employer may offer you more money in exchange for signing a non-compete agreement that prevents you from working for its competitors until the end of your notice period (or longer).

Components of a Severance Agreement

The components of a severance agreement are the same as any other employment contract. The following elements are typically included in most severance agreements:

Severance Pay

Severance pay is a payment made to an employee upon termination of the employment relationship. It may be paid in the form of a lump sum or can be in the form of regular payments over some time.

Benefits Package

In addition to getting paid, employees often have questions about their benefits after they leave a job. A severance agreement can specify whether an employee will continue to receive medical coverage through COBRA or if they will be eligible for unemployment benefits. It might also include information about whether they can participate in their company's retirement plan after leaving their job.

Non-Compete Clause

A non-compete clause prohibits an employee from working for another company in the same industry for a certain period after leaving employment with their current employer. These clauses are often used as part of severance agreements because they protect intellectual property while allowing employees to move on to other opportunities quickly after leaving one job for another.

Confidentiality Agreement

A confidentiality agreement is a contract that prohibits the parties from disclosing information. The purpose of such an agreement is to prevent the disclosure of information that may be detrimental to one party or another. The agreement can be used in almost any type of business. It can apply to any information relating to the company or any other parties involved in the operation of that company.

Covenant Not to Sue

A covenant not to sue is a promise by the employee not to take legal action against the employer after leaving. It may also be called a release or waiver. A covenant not to sue is intended to protect your company from potential lawsuits by former employees who claim they were wrongfully terminated or are owed money for work performed during their employment.

Covenants not to sue usually specify what types of claims will be barred by the covenant and how long it lasts after employment ends. For example, if you have a covenant that bars former employees from filing lawsuits against you for three years after leaving your company, any lawsuit filed during that time would be thrown out because it was filed too late under this covenant.

Termination date

This is when the employee's employment will end, and the company will no longer employ them. The termination date cannot be changed once it is set unless there is a mutual agreement between the employer and the employee.

Reason for termination

The reason for terminating an employee's employment should be clearly stated in this agreement section. It is usually listed as "terminated for cause" or "terminated without cause." If you terminate an employee for cause, you can withhold all or part of their final paycheck if you feel they owe you money for any reason (e.g., damaged company property).

Meet some lawyers on our platform

Michael M.

169 projects on CC
View Profile

Kristen R.

40 projects on CC
View Profile

Wendy C.

2 projects on CC
View Profile

Daniel R.

9 projects on CC
View Profile

Why Should You Consult a Lawyer for a Severance Agreement?

In general, if you're going to sign a severance agreement with your employer, you should consult a lawyer first. This is because both parties need to understand what they agree to and their obligations upon signing the severance agreement.

It's possible that both sides could have different interpretations of the terms in a severance agreement, and those misunderstandings could lead to trouble down the road if they aren't resolved before signing the document.

You should consult a lawyer for a severance agreement because:

  • You can get advice on the legal issues involved and ensure your rights are protected.
  • A lawyer can explain to you what the law requires for your severance agreement to be valid.
  • A lawyer can help draft your severance agreement to be legally binding and enforceable.

In some cases, an employer may offer you a severance package as part of an exit strategy from the company. If you leave the company, they will provide you with some benefits in exchange for not suing them for wrongful termination or other employment-related claims. Severance packages can include money, stock options or other significant compensation benefits.

Key Terms

  • Severance Package

    A severance package is a lump sum payment given to an employee who has been laid off or fired. This can also be referred to as a "severance agreement." Severance packages are often given when there is no written employment contract or when the employment contract does not provide for one.

  • Termination Date

    The date the employment relationship is terminated is usually the last day of work. The termination date is usually specified in the Employment Agreement (or severance agreement) signed when an employee first accepts a position with a company. It will also be specified in any subsequent employment agreements.


You've just been laid off and want to know if the severance agreement presented to you is fair.

Like most people, you'll likely try to find out what the deal is by asking friends or family. But unless they are lawyers, they won't be able to give you a legal opinion.

That's why it's important to seek the advice of a lawyer experienced in employment law issues. At ContractsCounsel, we can review your severance agreement and give you an unbiased analysis of whether it contains any legal problems or issues.

How ContractsCounsel Works
Hiring a lawyer on ContractsCounsel is easy, transparent and affordable.
1. Post a Free Project
Complete our 4-step process to provide info on what you need done.
2. Get Bids to Review
Receive flat-fee bids from lawyers in our marketplace to compare.
3. Start Your Project
Securely pay to start working with the lawyer you select.

Meet some of our Lawyers

Michael W. on ContractsCounsel
View Michael
5.0 (2)
Member Since:
July 13, 2020

Michael W.

Free Consultation
Get Free Proposal
Columbia, MD
12 Yrs Experience
Licensed in MD
Georgetown University Law Center

Graduate of Georgetown Law (J.D. and LL.M in Taxation) Injury Claims Adjuster before law school for top insurer Eight plus years of legal experience Past roles: Associate at premier boutique law firm in the DC metro area Policy Associate at a large academic and research institution Solo Practice Areas of Expertise: Contracts Business Formation Trusts and Estates Demand Letters Entertainment Transactions

Mark D. on ContractsCounsel
View Mark
5.0 (9)
Member Since:
August 27, 2020

Mark D.

Free Consultation
Get Free Proposal
San Diego, CA
13 Yrs Experience
Licensed in CA
Boston College Law School

California-based small business attorney handling matters related to securities, mergers & acquisitions, corporate governance, and other business transactions.

Agnes M. on ContractsCounsel
View Agnes
5.0 (6)
Member Since:
July 13, 2020

Agnes M.

Managing Attorney
Free Consultation
Get Free Proposal
13 Yrs Experience
Licensed in FL, NJ, PA
Florida Coastal School of Law

Agnes Mombrun Geter is the Founder and Managing Attorney of Mombrun Law, PLLC. She is an experienced attorney and is a member of the Florida Bar, New Jersey Bar, and the Pennsylvania Bar. The firm's practice focuses on Estate Planning, Business Law, and Debt Settlement including IRS Debt Relief. The firm's goal is to simplify the law and provide clients with the confidence and information necessary to make their decisions. The firm also provides project-based legal services to other attorneys and law firms, along with assisting as personal counsel and local counsel on legal matters.

Julian H. on ContractsCounsel
View Julian
5.0 (1)
Member Since:
July 14, 2020

Julian H.

Business Attorney
Free Consultation
Get Free Proposal
Washington, DC
21 Yrs Experience
Licensed in MD
Howard University School of Law

I am a business attorney with years of experience advising individual entrepreneurs and small businesses on issues ranging from entity selection/formation to employment law compliance, to intellectual property protection and exploitation. I often act as General Counsel for my clients fulfilling the legal function as part of a team of managers. I look forward to learning more about your business and how I may be of assistance.

Richard N. on ContractsCounsel
View Richard
4.9 (41)
Member Since:
July 9, 2020

Richard N.

Managing Member
Free Consultation
Get Free Proposal
Princeton, NJ
40 Yrs Experience
Licensed in NJ
New York Law School

I have been practicing law for 35 years. In addition to my law degree, I hold an MBA. I've created six companies, currently act as outside counsel to another 12, and have been an advisor to more than 500 startups and entrepreneurs.

Donya G. on ContractsCounsel
View Donya
4.9 (40)
Member Since:
July 10, 2020

Donya G.

Contract, E-Commerce Attorney & Dispute Resolution Specialists
Free Consultation
Get Free Proposal
United States
23 Yrs Experience
Licensed in CT, NY
Pace University School of Law

I am a licensed and active NY Contracts Attorney, with over 20 years of diverse legal and business experience. I specialize in reviewing, drafting and negotiating commercial agreements. My practice focuses on working with small business clients as well as clients from international brokerage firms on acquisitions, especially in the Ecommerce space; drafting, negotiating, reviewing and advising on business agreements; ; breach of contract issues, contract disputes and arbitration. I am licensed to practice in New York and Connecticut, and am a FINRA and NCDS Arbitrator. My experience includes serving as General Counsel to small businesses. This entails reviewing, updating and drafting contracts such as employments agreements, asset purchase agreements, master services agreements, operating agreements and a variety of business and commercial contracts. Additionally, I assist clients with business strategies, contract disputes and arbitration. My diverse experience allows me to give my clients a well-rounded approach to the issues they face. I have been at top AML law firms; a Vice President at an Investment Bank, a Civil Court Arbitrator presiding over cases in contract law, commercial law, a Hearing Officer, presiding over cases and rendering written decisions, and a Judicial Clerk to a Civil Court Judge. It would be a privilege to assist you and your business with my services.

Carlos C. on ContractsCounsel
View Carlos
Member Since:
July 11, 2020

Carlos C.

Attorney-at-law and Certified Public Accountant
Free Consultation
Get Free Proposal
Atlanta, GA
27 Yrs Experience
Licensed in DC, FL, GA
Inter American University

Carlos Colón-Machargo is a fully bilingual (English-Spanish) attorney-at-law and Certified Public Accountant (CPA) with over twenty years of experience. His major areas of practice include labor and employment law; business law; corporate, contract and tax law; and estate planning. He is currently admitted to practice law in Georgia, Florida, the District of Columbia and Puerto Rico and currently licensed as a CPA in Florida. He received a Master of Laws from the Georgetown University Law Center in 1997, where he concentrated in Labor and Employment Law (LL. M. in Labor and Employment Law) and a Juris Doctor, cum laude, from the Inter American University.

Matthew F. on ContractsCounsel
View Matthew
Member Since:
July 13, 2020

Matthew F.

Free Consultation
Get Free Proposal
Coral Springs, FL
20 Yrs Experience
Licensed in FL
UF Levin College of Law

As a business law attorney serving Coral Springs, Parkland, and Broward County, FL, Matthew has been recognized as “AV” rated, which is the highest rating an attorney can achieve through Martindale’s Peer Review system. Year after year Matthew is listed in the “Legal Leaders” publication as a top-rated attorney in South Florida in the areas of litigation, commercial litigation, and real estate. Matthew is also a graduate and instructor of the Kaufman Foundation’s FastTrac NewVenture Program, presented by the Broward County Office of Economic and Small Business Development.

John B. on ContractsCounsel
View John
Member Since:
July 13, 2020

John B.

Managing Partner
Free Consultation
Get Free Proposal
New York, NY
8 Yrs Experience
Licensed in NJ, NY
New York Law School

John Benemerito is the Founder and Managing Partner of Benemerito Attorneys at Law. Admitted to practice in New York and New Jersey, John represents small business owners and startups in the areas of Business and Securities Law. John received his Bachelors Degree at John Jay College of Criminal Justice where he majored in Criminal Justice. Afterwards, he attended New York Law School where he focused his studies on Corporate and Securities Law. John comes from a family of entrepreneurs. From as far back as he can remember he was always involved in his family’s numerous businesses. At the age of fifteen, John entered into a new business venture with his father and managed to grow and maintain that business through high school, college and law school.John is currently a co founder in over five different businesses. After law school, John decided that he wanted to help people like himself. He opened his own law practice and began working primarily with small business owners until he was introduced into the startup world. Ever since that time, John has worked with hundreds of startups and thousands of entrepreneurs from all different backgrounds in helping them achieve their goals. Having been an entrepreneur his entire life, John understands what it takes to create and maintain a successful business. He enjoys sitting down and working with his clients in figuring out each of their unique challenges.

Dillon N. on ContractsCounsel
View Dillon
Member Since:
July 13, 2020

Dillon N.

Associate Attorney
Free Consultation
Get Free Proposal
Chicago, IL
8 Yrs Experience
Licensed in IL, KY
University of Kentucky College of Law

I joined Enterprise Law Group, LLP as an Associate in March 2020. My practice has involved a wide range of legal matters from commercial real estate, finance and international business transactions to litigation matters including commercial disputes, personal injury and medical malpractice. Proficient in Spanish, I graduated from the University of Kentucky College of Law, the Patterson School of Diplomacy and International Commerce, and the University of Southern California. Prior to my legal career, I sought diverse professional experiences. After graduating from college, I orchestrated my own volunteering experience in southern Peru with a small non-profit organization. Later I gained valuable professional experience as part of a U.S. Senate campaign, and after that I joined the public policy team at Greater Louisville, Inc., Louisville's Chamber of Commerce affiliate. Prior to law school, I embarked on a month long excursion with the Northern Outdoor Leadership School in Alaska, which gave me a new found appreciation for sustainability.

Find the best lawyer for your project

Browse Lawyers Now

Want to speak to someone?

Get in touch below and we will schedule a time to connect!

Request a call