Advice when to not sign a severance agreement.
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Advice when to not sign a severance agreement.
I received a severance agreement from an employer and I am hesitant to sign it without talking to someone.
Hello ***!
My name is Dolan and thank you so much for contacting me!
I just had a few quick questions for you:
What is an example of what makes you hesitant to sign?
Thanks for responding so quickly.
I am not happy with this employer and have a lot of negative thoughts about them that I would want to share but I can see a clause that says I am not allowed to talk about my experience. That's the first thing.
Second thing is the severance pay seems bad. It is only 1 month's salary and I have no idea what is standard.
There are some other things related to confidentiality and 'release' I don't understand.
I feel like I was unfairly let go and I don't want to sign anything that could limit me taking legal action.
Got it! Is there something you want to be able to disclose to others specifically?
I think the place is a toxic place to work and their managers have bad intentions. I'm not sure I want to disclose it publicly but wouldn't want to not be able to share it if someone asked me about the company. Does that make sense?
I've been there for 6 years so have a lot of experience with these people.
Sorry I feel a bit all over the place.
I guess what would be helpful is to understand red flags in severance agreements and when it makes sense to not sign one as opposed to sign one.
It's not a problem! What reason did they give you for the termination?
They said I was underperforming which is hard for me to believe since I feel like I've been doing the same job I've been doing for a long time.
Feels made up and not justified.
I can imagine what you mean. Do you have another job offer lined up at all? Just a few more questions is all.
No - this was all very sudden.
I want to make sure I wouldn't have any limitations on going to a competitor either. I don't see anything in the severance agreement that discusses that but I know these people don't have good intentions.
Ok! Did you need to tell me anything else? If not, I can start with answering your question.
I think that's probably enough here but may have more questions.
Ok! I've been working on an answer while we've been chatting, so it'll just be a moment.
No problem.
I'm so sorry about this situation! I want to address your situation with a detailed response, so if you have any questions, don’t hesitate to ask because this law stuff can get complicated. It's tough to be in a situation like this, but let me break it down:
1. It's TOTALLY normal to have confidentiality agreements in exchange for a severance. In my experience, these companies are just concerned about their reputation and want to ensure that you don't do something like go to the news and explain how upset you were. If you tell a spouse or something or a friend, that's not going to be an issue, and without them actually suffering financial damages, you wouldn't need to worry.
2. When it comes to the severance, generally the law requires NO severance at all. It's all optional. This means that you would need to figure out a way to try to convince them to give you even more than what they are now.
One little known, but very effective tool that lawyers use to settle matters outside of court is called principled negotiation. All this means is that you are looking to get something done on the basis of principles, even if you can’t find a law to support you. It takes the anxiety out of dealing with the other side because you’re focused on the facts, not each other. With that said, here are some simple steps you can follow:
Figure out what the other side’s interests are (saving money, saving time, etc.?);
Think about what your interests are (saving money, saving time, etc.?);
Come up with 2 to 3 reasonable and objective ways to solve the problem;
Present it to the other side;
If the other side rejects, ask them, “Is there a reason why you do not feel it is necessary to negotiate?”
Consider what your best alternative to a negotiated agreement is. This will give you confidence that no matter what, you'll have an option.
They are already offering you money, but what you can do is suggest that you'll do something like train your replacement or offer some additional services for additional severance or an extension of your health benefits.
I know it’s a lot, but does that help make sense of things a bit more? I want to make sure I didn’t leave anything out.
Yeah that helps.
Just another question - is there anything that I would see in a severance agreement that would be a big red flag?
I would be happy to share the agreement with you, but guessing it would be extra fees for you to review it. If reasonable, I may consider it.
It is 8 pages in total.
The biggest red flags are going to be things regarding non-compete and non-solicitation clauses. Depending on your state, non-compete clauses could be restricted, but it usually just means you have to be careful going to a competitor. Non-solicitation clauses can make it hard to encourage clients or employees to come over to the new business.
As far as the agreement, I'd be happy to review! Reviews of 8-page agreements like this are $*** and my turnaround time is quick. I can set up a job for you on the site and I can answer whatever questions you've got.
OK got it.
Yeah that sounds good. If you review it, could you let me know some suggestions on what reasonable asks may be?
Also, would it be possible to have them help me get a job?
Of course! I can offer suggestions as to what you may want to ask or what you could offer.
I also see them mention healthcare benefits, which now that I am thinking about it is important to me until I find another job.
Are they offering to extend the benefits? If you aren't sure, that's ok, we can always set up a job for the review.
[FILE UPLOAD]
I've just uploaded the file to look at. Can you take a look to confirm your pricing?
Great! Yes, this is a standard agreement so I can do it for $***.
This is a bit more complicated than I thought. If you think you can help me get the equivalent of your fee (or more) in negotiating with them, then I think it is worth it.
Got it! So review and negotiation is a little different. Negotiation may require phone calls, emails, and drafting beyond just the review. My regular fee is just $*** an hour and most negotiations can take 2-4 hours, but I'd advise you if we get close to exceeding that time. We can set up the entire job through this site.
Ok sounds good. But I am guessing you could help me come up with reasonable 'asks' from them I can present before hiring you for negotiation?
Sure thing! For the $***, I can provide suggestions to you since it's short of outright negotiation and the extra work that is involved with that.
Ok great. I just got the offer too so will hire you now. Let me know if you need to have a call with me before starting or if you want to have one after.
You bet! We can set up a consultation to discuss any additional points you'd like to discuss as a part of this. It's not extra. I want to make sure we've covered everything thoroughly. Is there anything else you'd like to discuss, or any details I can go over again for you?
No all good - thank you.
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