Severance Agreements
One of the most common questions for an employee who is leaving employment with a company, whether on a voluntary or involuntary basis, is whether they will be provided a severance package that will include a severance agreement and severance pay. Although as a general rule you are not entitled to receive any type of severance package, certain employers created severance plans for their employees, and if you are an eligible participant in the plan, you may be entitled to severance benefits upon your separation of employment.
What is a severance package? According to the United States Department of Labor, severance pay is often granted to employees upon termination of employment. It is usually based on length of employment for which an employee has worked for their employer, although this can vary widely.
Importance of a Severance Agreement
A great majority of severance packages will contain an agreement for you to sign which will release (almost) any and all rights you may have (except for unemployment compensation, if applicable, and complaints that you may make to certain state/federal agencies). If you are over the age of forty (40) years old, your employer must give you twenty-one (21) days to consider the severance agreement, and if you sign the agreement, seven (7) days to revoke the severance agreement, under the Older Workers Benefit Protection Act (“OWBPA”). The OWBPA, which is part of the Age Discrimination in Employment Act, requires employers to follow a certain specific timeline to get an employee’s release of any age discrimination claims.
Any time you sign a severance agreement of any type, you should review the severance agreement with an attorney to ensure the language of the severance agreement is not illegal, unfair or one-sided. Recently, the EEOC has provided guidance to employers in the drafting of these agreements to make sure they are valid between the employer and employee. Many severance agreements utilize different types of language and the wording of these agreements may affect:
• Health benefits and your COBRA election;
• State unemployment benefits;
• Your tax liability;
• The release of certain claims you may have the right to assert in Court; and
• Your future employment status with the soon-to-be former employer and possibly future employment with that company and other companies.
Negotiating a Severance Package
Law Office of James. J. Collum, LLC routinely negotiates severance packages for employees upon their separation with a company. You must remember it is important to get what you deserve as this will be your opportunity to receive payment for your time of service with your soon-to-be former employer. Although there is no general rule of thumb as to how much a severance package is worth, there are many factors that can be considered in negotiating a severance package including, but not limited to:
• Your years of service with the employer;
• Your job position and annual income;
• Whether or not you are a member of any of the suspect classes protected by Title VII; and
• The employer’s track record granting severance pay.
Please contact Law Office of James. J. Collum, LLC for a FREE CONSULTATION about negotiating your severance to ensure you are being fairly compensated for the transition period that will lie ahead until you receive your next job. We can handle these types of matters on an hourly basis or frequently on a contingency basis (percentage of any severance you receive above what you may have already been offered).
Please contact Law Office of James. J. Collum, LLC for a FREE CONSULTATION regarding the possibility of receiving a severance package or to review a severance package already proposed by your employer by calling (330) 494-4877 or by e-mail at jcollum@collumlawoffice.com.
Law Office of James. J. Collum, LLC are Ohio severance package lawyers who represents individuals in their severence claims in cities all over Northeast Ohio including, but not limited to, the cities of Canton, Akron, Alliance, Canal Fulton, Massillon, Barberton, Cuyahoga Falls, Hudson, Fairlawn, Green, Macedonia, Munroe Falls, New Franklin, Norton, Stow, Tallmadge, Twinsburg, Kent, Ravenna, Streetsboro, Aurora, Brunswick, Medina, Rittman, Wadsworth, Dover, New Philadelphia, Uhrichsville, Orrville, Wooster, Columbiana, East Liverpool and Salem.
