Top Five Things to Know About Severance Agreements
Parting ways with an employer isn’t always a cut and dry process. Especially if you’ve invested years of your time and ideas to move the company forward. If you’ve recently been let go by your employer and are unsure how to proceed with the severance package you’re being offered, here are the top 5 things you should know about severance agreements and your options.
1. Have an Employment Attorney Review the Severance Agreement
If you had a medical condition, you would seek the advice of a physician. The same logic should apply when you have a legal situation such as an impromptu termination where the employer provides a severance package. There is a direct correlation between retaining an employment attorney to negotiate your severance package and the amount of the increase in severance pay. I have seen many people over the last twenty years attempt to negotiate their severance agreements by themselves with little success in the way of increased severance. Employers simply say, “This agreement is a take or leave it deal,” when employees attempt to negotiate the agreement on their own. An employment attorney can dramatically modify an existing severance agreement to make the deal fair and balanced, including the removal of one-sided non-competition agreements. The employment lawyer can also increase severance pay by developing legal claims you did not know existed.
2. If You Want More Money, You Need a Legal Claim
Face it, if you want more money in severance pay from your employer, you need to hire an employment lawyer. An employment attorney will review your detailed factual narrative and ask very pointed questions to develop legal claims that can be used to increase the amount of severance pay you will eventually receive. The employment lawyer can also diagnose the illegal activity committed by the employer and confront the employer with a sworn affidavit supporting a comprehensive notice of legal claims. When the employee substantiates his/her case in this manner, the employer often times increases the amount of severance pay the employee will receive under the severance agreement.
3. You Can Extend COBRA Coverage
An employment attorney will often time the length of the severance pay with the length of the COBRA period. This is a routine provision that most employees do not know they can increase. In fact, you can obtain COBRA coverage for up to 18 months.
4. Confidentiality is Key with Severance Agreements
When you receive severance compensation you provide a full release of claims against the employer that is completely confidential. Employers shield themselves against potential liability and publicity by using broad confidentiality provisions that cover you, your attorney, your financial advisor and your family. An employment attorney can narrow the confidentiality so that it is only applicable to you, relieving the unnecessary burden on your accountant, attorney and your family.
5. Legal Fees Paid By the Employer
The employer gave you the severance agreement to review with an attorney. Most employers include a provision that you acknowledge you have been given the opportunity to review the agreement with an attorney. Then, the employer must pay your legal fees to review their one-sided severance agreement. The agreement should be modified to include coverage for your legal fees.
Top Five Things to Know About Severance Agreements. If you’re looking to get the most out of your severance agreement and don’t know where to start, contact Carey & Associates, P.C., we concentrate in employment, wrongful termination, discrimination, whistleblowing, and more. Get the severance you deserve.
It’s a fact, in the workplace women are seen as unequal. Of course no sane male employee will admit that to you. This is not because he would be politically incorrect in making such a remark, but because of some weird and nondescript force or code (man-code) he feels compelled to adhere to at all costs. (I obviously do not share in this dysfunction). This phenomenon is real and has a tight hold on the U.S. workforce. Yes, I could use the word gender discrimination or some similar phrase like unequal pay, but those concepts do not shed light on how to overcome the inequality. Those terms only equate to engaging in litigation, which is a slow, emotionally draining and a financially devastating road to follow.
At the heart of the pay gap/promotion issue lies two socially inherent obstacles, bias and fear. Men hold the bias, most likely nurtured in them via family upbringing and culture. The bias is simple, men are better than women and thus should be paid more. This bias is real as represented in the statistics mentioned below. And women hold the fear, equally nurtured via family upbringing and culture. Women fear challenging men to get what they deserve. This is not to say that all men and all women hold these same characteristics, but enough of them do given the current statistics below.
On a positive note, the pay inequality issue may be transforming on its own. According to the BLS (U.S. Bureau of Labor Statistics (http://www.bls.gov/)), in 2012 women earned 81% of the median wages of men. I presume this applies to working women of all ages up to retirement age. However, the pay gap is smaller for younger women in the age range of 25-34 where the current ratio is 90%+. For women in the age range of 45-54, the ratio is 75%, representing a possible age biased toward an older generation of female employees. The BLS numbers indicate the gender income inequality issue may have a strong generational variable, where younger working women encounter less income inequality in comparison to men. Pregnancy may play a lesser role in this younger generation, as the CDC reports that the mean age of women experiencing a first time birth is 26. http://www.cdc.gov/nchs/fastats/births.htm) Previous income inequality explanations suggested pregnancy was one of the main culprits, but that appears to be changing. More women are working in the U.S. workforce than ever before, nearly 47% of the workforce is composed of women, and this number is projected to exceed 51% by 2018. (This information is based on 2010 data). (http://www.dol.gov/wb/factsheets/Qf-laborforce-10.htm). My opinion is that women should be paid 100% in comparison to men.
Women need a workable solution, not more statistics or more calls to action during the academy awards, which only draws more attention but does not solve the problem. I have worked with or represented many women either in consultative employment counseling, litigating discrimination cases or contract severance negotiations. I have mentally collected these work experiences and have some simple yet straight forward solutions to solve the gender pay gap.
Men need to promote more woman based on their performance, not their gender. I am confident women will feel appreciated and incentivized to improve the company bottom line. That’s what women tell me.
Men need to pay women more based on their performance, not their gender, even if it means paying a wage equal to or higher than those paid to similarly qualified men. I am confident women will feel appreciated and incentivized to improve the company bottom line. Again, this is what women tell me.
And, everyone, men and women alike, should be allowed to work a flexible work schedule, which increases employee motivation and production quality for the real work companies want performed. In my office, we have a flexible work schedule and the work is completed in a timely fashion and everyone, including myself, is happier! The stale and stringent 9-5 work hours needs to be tossed out the window. I have heard too many complaints over the years by clients regarding ridiculous and inflexible work schedules enforced by poorly managed (some FORTUNE 500) companies.
Women need to aggressively self-advocate for promotion and salary increases even at the risk of creating an impenetrable glass ceiling or worse losing their jobs. Your employment (either at-will or term) is a contract that is constantly being renegotiated every day. If you do not ask, you will not receive. By professionally demanding a salary increase and promotion, you force your employer to tell you how they really feel about you and your performance. If they say no, move on to a company that does appreciate your skills, experience and knowledge.
The bottom line is to become more proactive, assertive and never fear the negotiation to get what you deserve, instead embrace it. This applies equally to us all.