Today, we discuss how to negotiate your severance pay. This is a fascinating topic because it’s an issue not covered in the Fair Labor Standards Act (FLSA), which governs most anything else related to wages. Any rules governing severance pay exist due to an employee’s employment contract, or the employer’s severance policy and practice. Neither the FLSA nor state law requires employers to provide employees with severance pay.
What are the best ways to negotiate a better severance package?
Negotiate Your Severance Pay – Key Strategies
In one of our earlier posts, we mentioned a few things you should know before signing a severance package. Much of it involves knowing the details of any severance offers because these details govern how much you receive in severance pay, and what you must do and give up to receive severance pay. Yes, you can lose severance pay and other severance benefits if you do not follow the severance agreement and/or the severance pay policy.
Assuming you know the basics about severance packages, what are some winning negotiation strategies?
Four Effective Strategies
- Don’t Sign Anything too Quickly
- We always recommend that severance pay candidates take the acceptance process slowly and get professional assistance. Many high-paid individuals experience buyer’s remorse when they separate from a company, only to realize they could have negotiated a better deal. If possible, you should find out what other employees at your same level received in severance pay. The employer cannot prohibit employees from discussing severance pay amounts.
- Make a Case for Why You Deserve a Severance Package
- Severance pay is no different from landing a job in the first place: you have to make a case for why you’re exceptional and worthy. This involves portraying yourself in the best possible light, highlighting all your significant milestones, objective accomplishments, marketable skill sets, and so forth.
- Know What’s in a Severance Package
- Many applicants don’t pay enough attention to the language of the severance package. The severance package language controls the severance pay and other benefits you will receive. You want specific language on how much you will be paid, when you will be paid, and the other benefits you will receive such as health care, vacation time payout, vesting of stock options and other equity, outplacement assistance, and more.
- Don’t Be Afraid to Say ‘NO’
- Since you may not like the deal, and the employer might not be willing to offer much better, you may have to reject it altogether. If the other side won’t respect your hard limits or basic preferences, you may have to say “no,” and file a claim against the employer for leverage for a better severance package.
Beware the Many Ways to Forfeit Severance Pay
As we mentioned, there are a few ways to forfeit severance pay if you violate the severance agreement or policy. The specific language controls; some common examples include:
- You can’t violate any Non-Disclosure Agreements (NDAs) or non-compete agreements.
- You’ll void any severance pay if you speak poorly of your former employer, including on online platforms like social media if your severance pay contains a non-disparagement restriction.
- You will generally need to return all company equipment and information unless you specifically negotiated to keep it.
Always Have an Experienced Employment Attorney Review the Contract with You
Would you like to avoid that sinking feeling of knowing you wouldn’t have lost money if you had someone help you check your contract? It commonly happens to many highly compensated individuals, but it doesn’t need to happen. You should hire an employment lawyer to review ANY severance agreement before signing it.
Rowdy Meeks Legal Group LLC routinely reviews severance packages and policies, and advises employees as to what the employee will receive and the accompanying restrictions. Most often, the employee must waive all employment-related claims the employee may have against the employer and agree to never sue the employer over these claims. Thus, it is critical for employees to understand their rights and the real cost of waiving them.
Negotiate Your Severance Pay Better with Reliable Counsel from Rowdy Meeks Legal Group LLC
Rowdy Meeks Legal Group LLC represents employees in all wage matters including severance pay, job mis-classification, unpaid overtime, and other wage disputes. Whether you’ve been the victim of wage discrimination or simply don’t understand something related to employment law and severance pay, we can assist. You should contact Rowdy Meeks Legal Group LLC today if you have any questions or concerns about your pay.