Severance Agreement Lawyers
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What Is a Severance Agreement?
A severance agreement is a type of contract between an employee and their employer regarding the rights and duties of each party in relation to a job termination. The agreement typically gives benefits or additional pay to an employee who is being terminated, usually in exchange to for the employee agreeing not to sue for wrongful termination or to abide by a non-disclosure or non-compete agreement. The total benefits and pay being offered is often called a severance package.
These may be issued and agreed upon at the beginning of the employment term when the person is hired. In other instances, a severance agreement may be offered later on down the line, especially if the employer has had advancements or promotions during their time with the company. Severance agreements are also commonly used in relation to mass layoffs.
What Is Typically Addressed in a Severance Agreement?
Severance agreements usually address a wide range of employment matters and issues. These can include:
- The amount of severance pay being offered to the worker(s)
- Offers for extensions of benefits (i.e., healthcare, insurance)
- Non-compete agreements prohibiting the employee to work for other employers (usually within a specific time period)
- Non-disclosure agreements regarding sensitive company information
- Provisions regarding wrongful termination lawsuits
What Are Some Legal Issues Associated with Severance Agreements?
Like with any contract or legal agreement, all parties must agree to all of the terms in a severance agreement. Also, the terms and provisions cannot violate any state or federal employment laws. Most legal disputes involving severance agreement have to do with a breach of the contract terms. For instance, legal action may be needed if the employer fails to pay out the severance payment according to the contract terms. Alternatively, the employee may be liable for a breach if they fail to follow restrictions in a non-disclosure term.
In some cases, a severance agreement dispute may involve an aspect of discrimination. For instance, if an employee is denied a certain severance benefit on account of their race or age, it may be considered a form of employment discrimination. The legal issue may then require an investigation with the Equal Employment Opportunity Commission (EEOC).
Also, recent laws state that severance agreements may not affect an employee’s right to file a claim with the EEOC.
Are There Any Legal Remedies for Severance Agreement Disputes?
Legal remedies for a severance agreement dispute typically include a monetary damages award. These will usually cover any losses caused by the breach of contract. For instance, the damages award may cover any amount still owed by the employer to the employee.
Should I Hire a Lawyer for Help with a Severance Agreement Dispute?
Severance agreement disputes can often involve some complex technical employment law issues. You may need to hire an employment law attorney in your area if you need legal assistance. Your attorney can provide you with legal advice and guidance for your claim. If you need to attend any court meetings, your lawyer can represent you during those times as well.
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Last Modified: 12-15-2015 10:13 AM PST
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