Can a severance agreement be signed electronically?

Yes. Electronic signatures are generally enforceable under the ESIGN Act (15 U.S.C. ch. 96) and UETA in most states. Ensure the signer demonstrates intent, consents to electronic records, and that the platform preserves an auditable record.

What about age-related release requirements?

If the release affects employees aged 40 or older, include the Older Workers Benefit Protection Act consideration period (commonly 21 days) and a 7-day revocation period to avoid invalidating the release.

Do severance documents need notarization or witnesses?

Typically no notarization or witnesses are required for severance agreements. Check state-specific rules for particular clauses or where statute requires additional formalities.

How should COBRA and benefit continuation be addressed?

Summarize health coverage continuation options, COBRA election windows, and employer-paid subsidy terms if any. Provide separate plan notices as required by federal law.

What are retention best practices for signed packages?

Retain executed agreements for at least three years after filing-related events and longer for litigation risk; if PHI exists, follow HIPAA six-year retention guidance.

What if an employee revokes a signed release?

If the release includes a valid revocation period (e.g., ADEA), treat the revocation as effective per terms and consult counsel on rescission of benefits or negotiated alternatives.

Electronic Signature
Templates
HR
Severance Package Breakdown

Severance Package Breakdown

This template is fully customizable. Edit the text, fill out the fields, and send it for signature. Give it a try!

SEVERANCE PACKAGE BREAKDOWN

Employee Information

Employee Name:

Address:

Phone: Email:

Position and Separation Details

Position Information

Last Day of Employment: Effective Separation Reason:

Severance Summary

This Severance Package Breakdown summarizes the components of the severance offer made by Employer to Employee and is subject to the terms and conditions set forth in the Separation and Release Agreement (the Agreement). The Employer offers the following components, which are contingent upon Employee's execution and non-revocation of the Agreement where applicable.

Itemized Payments and Benefits

Salary Continuation

Gross Amount: $ Frequency: Duration (weeks/months):

Lump Sum Payment

Gross Lump Sum: $ Payment Date: Taxes Withheld: $

Accrued Paid Time Off (PTO) / Vacation

Accrued Hours: Payout Rate: $ Total PTO Payout: $

Benefits Continuation

COBRA/Benefits Subsidy: Duration:

Bonus / Commission / Equity Outplacement and Other Services

Outplacement Services Provided:

Payment Allocation and Tax Withholding

Total Gross Severance: $ Applicable Withholding (federal/state): Net Amount Payable: $

Conditions and Release Terms

The following conditions are required for the Employer to deliver any severance consideration: (a) execution by Employee of the Separation and Release Agreement; (b) non-revocation of the release during any applicable revocation period; (c) return of all Employer property; and (d) compliance with confidentiality and non-solicitation obligations specified in the Agreement. Failure to satisfy these conditions may delay or forfeit severance payments.

Release of Claims

Employee will provide a general release of claims in the Agreement, releasing Employer and related parties from all claims up to the date of execution, except for rights that cannot be waived by law. Employee acknowledges that specific statutory rights (if any) may be preserved as described in the Agreement.

Confidentiality / Non-Disparagement

As a condition of the severance consideration, Employee agrees to abide by the confidentiality and non-disparagement covenants set forth in the Agreement. Breach of these covenants may result in recovery of paid amounts and other relief permitted by law.

Return of Property

Employee must return all Employer property, including but not limited to keys, electronic devices, documents, and proprietary information, by: . Failure to return property may reduce severance amounts.

Legal Notices and Statements

At-Will Employment: Nothing in this breakdown alters the at-will nature of the employment relationship, unless expressly stated in a separate written agreement executed by authorized representatives of the Employer.

Equal Opportunity: Employer is an equal opportunity employer and does not discriminate on any protected basis. The severance offer is made independently of any protected characteristic and in accordance with applicable law.

Employment History

Employer 1

Dates Employed: Reason for Leaving:

Employer 2

Dates Employed: Reason for Leaving:

Education

References

Reference 1

Reference 2

Reference 3

Authorizations and Certifications

Applicant Certification: I certify that all information provided in this Severance Package Breakdown and any attachments is true, complete, and accurate to the best of my knowledge. I understand that this document reflects only the components of the severance offer and does not itself constitute the full Separation and Release Agreement.

Authorization to Contact and Background Checks

By signing the Agreement, Employee authorizes Employer to contact prior employers, verify employment history, and conduct background checks to the extent permitted by law. Employee acknowledges that information found may be used in determining eligibility for severance payments where permitted.

Acknowledgment of Conditions

I acknowledge that acceptance of severance consideration may require a signed release and that certain amounts may be conditioned on continued compliance with post-employment obligations described herein and in the Agreement.

Additional Notes

Employee Printed Name:

By:

Date:

Employer Printed Name:

By:

Date:

What a Severance Package Breakdown Is and Why It Matters

A Severance Package Breakdown is a written summary that itemizes pay, benefits, continuation of insurance, vested equity treatment, outplacement services, and any conditions tied to a separation agreement. It clarifies gross and net severance amounts, tax withholdings, benefit continuation (including COBRA where applicable), release or waiver language, and timelines for payment and return of employer property. Employers use the document to ensure consistent treatment and to provide departing employees with a clear, auditable record of their post-employment compensation and obligations.

Why a Clear Breakdown Reduces Risk and Disputes

Providing an itemized severance breakdown improves transparency, reduces misunderstanding about amounts and timing, and documents agreed terms for both parties. A clear record supports HR, payroll, and legal teams during administration and helps demonstrate compliance with federal statutes, such as the Older Workers Benefit Protection Act when age-related releases are involved.

Who Typically Prepares and Reviews a Severance Package Breakdown

These roles commonly create, approve, or receive severance breakdowns in workplace separations.

Human resources leaders who design severance offers, ensure policy consistency, and coordinate payroll adjustments.
Payroll and benefits administrators who calculate gross/net pay, tax withholdings, and insurance continuation details.
Employment counsel or outside attorneys who review release language and confirm compliance with federal and state requirements.

In many organizations, these groups collaborate to finalize the breakdown and retain copies for compliance and audit purposes.

Essential Elements to Include in a Professional Severance Package Breakdown

A comprehensive breakdown lists financial, nonfinancial, timing, and legal elements so all parties understand deliverables and obligations.

Severance Pay

Specify gross amount, pay schedule, and whether payments are lump sum or installments; note tax withholding and net payment expectations.

Accrued Pay

Detail payout for unused vacation, PTO, or bonuses and whether they are included in the severance calculation or paid separately.

Benefits

Describe health insurance continuation (COBRA eligibility and dates), life insurance, and retirement plan treatment, including employer contributions.

Equity and Options

Explain treatment of vested and unvested stock options, exercise windows, and any accelerated vesting or forfeiture conditions.

Release Terms

Summarize required release or waiver language, any noncompete obligations, and the timeframe for execution and revocation rights if applicable.

Return & Cooperation

List obligations to return property, preserve confidentiality, and any ongoing cooperation required for investigations or litigation.

Step-by-Step: Preparing and Issuing a Severance Package Breakdown

Follow these steps to prepare a compliant and clear severance breakdown for a departing employee.

01

Gather payroll data: Collect latest pay, PTO balances, and benefit enrollment details.
02

Calculate amounts: Compute gross severance, withholdings, and net pay.
03

Draft terms: Summarize release language, timelines, and conditions clearly.
04

Review and sign: Have legal and HR approve, then obtain employee signature.

How to Configure a Digital Severance Workflow

Set up a repeatable e-signature and payroll routing workflow to streamline approvals and payments.

Field	Configuration
Document Template	Create a reusable template with placeholders for pay and benefit fields.
Signer Order	Set HR → Legal → Employee sequential signing to ensure review before execution.
Authentication Level	Use email plus SMS code or stronger verification for sensitive releases.
Delivery Method	Enable signed-copy distribution to payroll, HR, and the employee for records.

Digital Signing Workflow for a Severance Breakdown

Typical online signing follows a linear path from preparation to completed record with audit details.

Upload Document: Load the finalized breakdown into the e-signature platform.
Place Fields: Add signature, date, and optional checkbox fields for releases.
Send to Signers: Dispatch via email link or secure signing portal.
Capture Audit Trail: Automatically record timestamps, IP, and authentication events.

Technical and Compliance Considerations for eSigning Severance Documents

Use an e-signature platform that supports legal validity, secure transmission, and record retention for sensitive HR records.

File formats: PDF, DOCX supported
Integrations: Payroll and HRIS connectors
Authentication: Email, SMS, or stronger

Ensure the platform can produce an auditable certificate of completion, comply with ESIGN and UETA, and support HIPAA BAA if health information is included.

Key Timelines and Deadlines to Track

Observe statutory and plan-driven deadlines that affect acceptance, revocation, and benefit continuation.

Acceptance Window:

Specify days allowed for employee signature (commonly 7–21 days).

ADEA Consideration Period:

Provide 21 days for employees 40+ when a release affects ADEA rights.

Revocation Window:

Include a 7-day post-signing revocation period for ADEA releases.

COBRA Notice:

Initiate COBRA eligibility and notice timing per federal rules.

Payment Timing:

State when severance is paid and whether payroll cycles affect timing.

Milestones from Offer to Final Payment

Track these sequential milestones to ensure consistent execution and recordkeeping.

01

Offer Issued

Employer provides the severance package breakdown and associated release.

02

Employee Review

Employee reviews and may seek counsel during the consideration period.

03

Execution

Employee signs and employer countersigns, recording the execution date.

04

Payment Completed

Payroll processes severance per the agreed schedule and documents payment.

Common Preparation Pitfalls to Avoid

Failing to state whether severance amounts are gross or net, which leads to payroll disputes and reimbursement delays.
Omitting clear treatment of vested equity and option exercise windows; unclear terms create post-termination disagreements.
Neglecting to include the ADEA consideration and revocation periods for employees aged 40 and older.
Sharing documents via unsecured email or storing signed copies in unmanaged locations that risk data exposure.

Consequences of Incorrect or Incomplete Severance Breakdowns

Tax Withholding Errors: Can trigger payroll corrections and tax reporting penalties.

Failure to Comply: Violating ADEA timing can invalidate a release.

Privacy Breach: Improper handling of health data may implicate HIPAA obligations.

Disputed Equity: Ambiguous option terms can lead to litigation or arbitration.

Late Payments: May violate state wage laws and incur penalties.

Recordkeeping Gaps: Absent records hinder defense in employment claims.

eSignature Vendor Pricing and Feature Comparison for Severance Documents

Compare starting prices and key capability differences that affect high-volume or sensitive HR records; signNow is listed first per vendor comparison conventions.

	signNow	DocuSign	Adobe Sign	PandaDoc	HelloSign
Starting Price	$8/user/mo	$15/user/mo	$14/user/mo	$19/user/mo	$15/user/mo
Free Trial	7-day trial	Varies by plan	Varies by plan	Varies by plan	Varies by plan
Bulk Send	Yes	Yes	Yes	Yes	Varies
Audit Trail	Yes	Yes	Yes	Yes	Yes
HIPAA Compliant	Yes	Yes	Yes	No	No
Envelope Cap	No cap	100 envelopes/user/year	Varies by plan	Varies by plan	Varies by plan

FAQs and Troubleshooting for Severance Package Breakdowns

Answers to common questions about drafting, signing, timing, and legal compliance for severance documentation.

Need help? Contact support

Can a severance agreement be signed electronically?
Yes. Electronic signatures are generally enforceable under the ESIGN Act (15 U.S.C. ch. 96) and UETA in most states. Ensure the signer demonstrates intent, consents to electronic records, and that the platform preserves an auditable record.
What about age-related release requirements?
If the release affects employees aged 40 or older, include the Older Workers Benefit Protection Act consideration period (commonly 21 days) and a 7-day revocation period to avoid invalidating the release.
Do severance documents need notarization or witnesses?
Typically no notarization or witnesses are required for severance agreements. Check state-specific rules for particular clauses or where statute requires additional formalities.
How should COBRA and benefit continuation be addressed?
Summarize health coverage continuation options, COBRA election windows, and employer-paid subsidy terms if any. Provide separate plan notices as required by federal law.
What are retention best practices for signed packages?
Retain executed agreements for at least three years after filing-related events and longer for litigation risk; if PHI exists, follow HIPAA six-year retention guidance.
What if an employee revokes a signed release?
If the release includes a valid revocation period (e.g., ADEA), treat the revocation as effective per terms and consult counsel on rescission of benefits or negotiated alternatives.

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