How to Negotiate a Severance Package
By Gregory Thyberg on May 01, 2020
Losing a job is an unfortunate experience that can upend your life and leave you wondering what to do next. Sometimes employers will offer a severance package, but these aren't always fair. An employment law attorney can review the details of your job loss and help negotiate a severance package that is fair.
Gregory A. Thyberg offers guidance on how to negotiate a severance package to clients in Sacramento, CA, and surrounding areas. If you need help negotiating a fair severance package, we welcome you to schedule a consultation.
What Is a Severance Package?
A severance package is pay or benefits that a person may be offered or owed at the time he or she is forced to leave a job.
Severance packages may include payment for unused vacation time, holiday pay, or sick leave, as well as health benefits.
Think Before Signing
In most cases, people who are offered a severance package are allowed some time to review the package before signing. This is a good time to consult an attorney so that you are prepared to negotiate a severance package agreement that is fair to you and not just the employer.
Whether you choose to have an attorney negotiate your severance package on your behalf or you plan to negotiate yourself, the following are other considerations to help you understand how to negotiate a severance package.
You May Not Want to Take the First Offer
When offered a severance package in Sacramento, it's important to know that you don't have to immediately sign the offer or accept it.
If the offer is too low and you believe there's a basis for receiving a higher payout, it may be possible to negotiate for more money.
Benefits Are Just as Important as Money
In addition to securing a payout that seems fair, it's also important to consider benefits that may or may not be included in a severance package.
Losing health insurance can be costly and those who have paid into a pension program will want to protect their investment. Negotiating the terms for retaining a pension program or staying on the company's health insurance for the first few months of unemployment can add value to a severance package.
Stick to Business
When trying to negotiate a more favorable severance package, it's important to keep things professional and stick to facts to support your position rather than trying to convince an employer to increase your payment for personal reasons, like needing to support your family.
Facts, like the length of time you've worked for a company or examples of ways you've contributed to the business are better for demonstrating why the company owes you more than it may be offering.
Check for Job Restrictions
Sometimes severance packages include language that restricts former employees from working for certain companies, usually competitors, for a period of time after termination.
This can limit your job search and make it more difficult to find employment. Before agreeing to such provisions, you may be able to reduce the number of restricted companies named in your severance package or reduce the amount of time you must wait before taking a position with a restricted company.
Sometimes Not Signing Is Best
Sometimes a severance package is so restrictive that it can be difficult, or nearly impossible, to find a new job. The result can be a huge career setback that may cost more in lifetime earnings than the loss of whatever payment is offered in the severance package.
Consulting an employment law attorney can help determine whether accepting a severance package is in your best interest.
Contact Thyberg Law
If you live in or near Sacramento and need help negotiating your severance package, you are encouraged to call (916) 204-9173 to schedule a consultation with employment law attorney Gregory Thyberg. Mr. Thyberg can review your severance package and help you get a fair payout.