Initial Severance Plan Made Easy

Initial severance plan

hi my name is Jamal and McFadden I am delighted to have been asked to present this installment on life for today I'll be talking about severance agreement and this topic is part of a broader topic about things to consider when you're leaving your company the first thing is what if a severance agreement has not been presented to you by an employer my general advice is still asked it doesn't hurt to ask for some kind of compensation or other things that we'll get to when you are exiting the company and their various reasons that the company may be inclined to give you some form of severance or separation benefits even if the benefits are non-monetary there might be an opportunity for you to obtain severance benefits anyway if for example you have an employment agreement that requires the payout of severance and severance benefits at the time that your separation means many of us don't have employment agreements but if you do remember that document and go back and take a look at it to see if it says anything at all about benefits that might be provided to you in the event that your employment ends the other thing to think about is if the company has a practice of providing severance benefits when a when an employee departs so it could be that Joe and Jane and three other managers at your love will have been given some kind of severance benefits then you have an argument that you should be giving some benefits as well and something that comes up it's even bit less likely but it does come up if you've had a supervisor that has offered you or has promised you some kind of benefit when you leave in exchange for maybe staying on with the company for longer than you intended or some other circumstances that might be in play you may be able to rely on that promise as grounds for you to obtain severance benefits from the company as well so don't give up just think about whether or not they're opportunities or avenues that you can explore - at least form the basis of your request for severance or separation benefits a lot of clients come to me when they have been given the severance agreement already and they want to know what their rights are what the options are do they have any power to negotiate what on earth should they ask for what should they not ask for and that's typically the context in which I get involved if you are considering if you have a severance agreement and you're considering what to do my first bit of advice is take your time take your time then review the agreement sometimes you're presented with a severance agreement and an involuntary or involuntary separation situation and so emotions are just running wild you don't know what to do you've been at the job for years and years and you're just trying to figure it all out but stop for a moment just take it in and then figure out what you want to do in terms of the severance agreement the most important thing to do is figure out what your timing is sometimes you will be told in the meeting that you have seven days to find this agreement other times you will not be told but the agreement should have some information about how long you have in order to decide whether you want to accept the terms of the severance or negotiate them now after you've done that and you figure out I have the timing next thing you want to do is figure out what if what they're offering you is reasonable if there are other things that you want in addition to the severance and you want to think about whether they are asking you to do something that you were not already obligated to you for example if part of the severance agreement asks you to agree not to compete with the company you can already agree with the company that you wouldn't compete and they try to get it in through the severance agreement that might be an opportunity for you to even ask for more benefits in exchange for providing that that benefit to the company of not competing with the company for their business so when you think about what to ask for you want to think about things that might not be readily apparent things beyond money I should say right so you want to ask for more money maybe in exchange for what they're asking you to do in the severance agreement but there's money and then there's cash equivalents so you may want more medical benefits for example just really think about what you want and need and also think about what you want to do next so if for example what you want to do next is open a business sure more money would be nice but also there might be some things like office furniture or your computer or your other electronics or office space for a period of time there could be a number of things that may help you in your next venture that the employer may be more willing to give up than straight cash the other thing that you might want to think about whether starting a business or not is whether there's an opportunity for you to remain on with the company in some capacity maybe you can be a consultant it could be the case that you your services are value they needed and the company really needs your help in making a smooth transition either to a new employee or employees or somehow transitioning the work that you were doing it might also be beneficial to you to have a letter of reference that's something that you can ask for work out placement services that's another thing and when we talk about cash equivalents I've helped executives negotiate for a larger contribution to their retirement plan your stock options you can negotiate for when the windows this but just think outside of the four corners of the documents that you you have been given and think about what it really is that you need now the next thing to consider too is what you are already entitled to receive so if for example they say in the severance agreement that they will pay you out vacation you may already be entitled to receive vacation so that's not anything in addition that that's not additional value you that should compel you to do what it is that the company is asking you to do in that severance agreement if you owe the company money like for example moving expenses if you are leaving the company before you are before time that you will have repaid the company's investment and bringing you on there as an employee that might be something you want to negotiate because some employers have been known to go after employees or even things like moving expenses if they are not repaid now understand what your company wants as well and this is a good way to get some leverage - and I hope you go in in your negotiating position so the company will want a number of things in the severance agreement one could be restrictive covenants that I mentioned the company could want you to agree not to compete and again that ups the value of your expense the company also generally doesn't want you to say bad things about the company when you leave so they want you to leave relatively happy so they may be willing to put some money or other benefits on the table to get that done they also want to release so if there is a chance at all that you may have some kind of claim against the company be it some kind of discrimination or retaliation claim or claim involving wages or any kind of contractual issues they want to for you to go away or walk away with a clean slate and they don't have to say we don't want to have to worry about you potentially filing a claim against them in the future so you do have some leverage if you really stop and take those think about what it is that the company could want for you in exchange when people decide to come to me most often they have decided that they at least want to consult with a lawyer but really think those out should you hire a lawyer now I know it might not be in my best interest to say no but sometimes I do advise clients that maybe maybe you should think about not getting a lawyer involved at least perhaps in direct negotiations with the company so the reasons to hire a lawyer one it creates some distance between you and the process so sometimes as employees we're emotionally connected to it especially if we've been in a place where very long time and the departure or the separation is a surprise sometimes it's difficult to kind of disconnect so a lawyer provides a a neutral if you will to really and it's emotionally attached so they can really evaluate the business or the economic terms of the agreement a good employment lawyer also will be able to understand the terms of the agreement and explain it to you they'll be able to explain sort of our legal jargon jargon in a way that you can understand and determine whether or not the severance that's being offered is good for you or not they can also a good lawyer can help you determine what leverage points are do you have any leverage you have any room to ask for more are there any potential issues that the company may be concerned about that might increase the value of your reliefs also perhaps the company will take you more seriously if you hire a lawyer sometimes if a lawyer is saying something the exact same things that you're saying the because a lawyer is doing and because we've made the investment in hiring a lawyer the employer might take your claims a little more seriously so those are some reasons to consider hiring a lawyer the the reasons why you may not want to have a lawyer engage in direct negotiations one there is the financial expense of it and when you are facing a job loss the last thing you want to do sometimes think about paying out more money but if you hire a good employment lawyer it may well be worth the investment because the value of your severance could be increased the other reason to consider or not hiring a lawyer to engage in direct negotiations is sometimes when you hire a lawyer and it puts the employee or on the defensive their backs to get up against the law and even if they were inclined perhaps to engage with you and give you more in the way of separation than if it's because they feel attacked by a lawyer they may shut down in a way which is not productive to you the they're kind of real-life reason is it is very likely that you want to work or have some gives these feelings after your company and sometimes work may get around despite confidentiality provisions that you were the one who students are threatened to your former employee so long term that might be something that you decide is not in your best interest but even with all of that I have very often negotiated behind the scenes help the client behind the standard the ghost write emails or just give them general advice to arms and empower them if you will with the information that they need to to handle the direct negotiations with their employer so those are some considerations I'm happy to answer any questions that you may have about the process about agreements about kind of what's next for you and some things that you might want to consider asking for work this has been jamala McFadden you can reach me at Kamala McFadden at life or L IFE fo r th comm thanks so much you