SHOULD YOU SIGN A SEVERANCE AGREEMENT?
Signing a Severance Agreement Can Affect Your Rights
When your employment comes to an end through a layoff, resignation, or termination and your employer offers a severance agreement, you are placed in a time-sensitive, emotional decision – whether to sign it. That decision can drastically alter your finances and possibly future job opportunities.
Exercise caution if you are being pressured into signing a severance agreement on the spot. You may be entitled by law to a specified amount of time to consider the severance agreement before signing it.
For example, under the Age Discrimination in Employment Act (ADEA), an employee over the age of 40 who is laid off is entitled to 21 days to consider whether to sign a severance agreement. If part of a group layoff, the employee is entitled to 45 days under the Older Workers Benefit Protection Act (OWBPA), which also provides a seven-day right to revoke period after signing.
What is a severance agreement?
A severance agreement is a contract created by your employer that typically requires you to waive your right to sue in court for wrongful termination based on age, race, sex, disability, and other types of discrimination in exchange for a specified amount of severance pay.
If the employee signs a such a waiver, even if he or she may have been a victim of illegal discrimination based on race, color, religion, sex (including gender identity, sexual orientation, and pregnancy), national origin, age (40 or older), disability or genetic information, the employee is precluded from filing a lawsuit.
In addition to the waiver of rights, a severance package may include:
1. A non-disclosure agreement requiring the employee to refrain from talking about the job or the circumstances of his or her termination from employment.
2. A non-compete agreement precluding the employee from accepting a similar job for a certain amount of time in a specific geographical area.
3. A non-disparagement agreement that requires the employee to refrain from communicating negative facts or opinions about the employer or the employee’s job. This includes social media posts.
It is plain to see that an employee who signs a severance agreement may give up many rights in exchange for the severance pay offered by the employer. As with all contracts, it is important to know what you are signing when you sign a severance agreement – and to be sure you agree its terms. If an employee voluntarily accepts the terms of a severance agreement, generally he or she must abide by those terms.
Should you consult a lawyer before signing a severance agreement?
In some cases, the terms of the proposed severance agreement may be negotiable. You should consult an attorney to help you negotiate better terms with your former employer.
In other cases, an employer may be adamant that the terms of the severance agreement are non-negotiable. However, you can consult with an attorney to discuss countering your employer’s offer with a demand for additional financial compensation in exchange for waiving your rights.
Before signing a severance agreement, it is important to determine whether the employer is offering something of value – something to which you are not already entitled – in exchange for your waiver of rights. For example, if your company has for many years provided severance pay to laid-off employees and instituted a policy regarding severance pay, you may be giving up your rights for nothing in return.
The financial and emotional pressure to sign a severance agreement can be considerable.
If your employer gives you a severance agreement to sign, you should contact an experienced employment attorney to review it. Murphy Law Group focuses exclusively on employment law. We will review your severance agreement and explain your rights. We can potentially help you to secure a more financially beneficial severance package. Email us at firstname.lastname@example.org or call (267) 273-1054 for a free consultation.
ARE NON-COMPETE AGREEMENTS REALLY ENFORCEABLE? WHAT YOU NEED TO KNOW
You feel you’ve gotten as far as you can in your current job and you’re thinking about moving on. You noticed a job opening at a competing company and you think it could be a perfect fit. You also happen to know the hiring manager, so getting an interview would probably be as easy as making a phone call …
The problem is, you signed a non-compete agreement when you started your current job. At the time, it didn’t seem like a big deal. After all, you were just starting a new gig and the last thing on your mind was getting back out in the job market.
You’ve heard that non-competes are largely unenforceable. Should you take the chance and go for the new opportunity?
In any case, it’s a good idea to understand how non-competes work and how they’re viewed under the law.
Non-Competes: What They Are
Non-compete agreements, or restrictive covenants, may include a variety of terms and conditions. Many prohibit employees from working for competitors for a given length of time after their employment is terminated, whether they leave voluntarily or involuntarily.
Some restrictive covenants may include language barring employees from disclosing trade secrets or confidential information, soliciting the clients of the former employer, or attempting to woo coworkers to new jobs at other companies.
Non-compete agreements are most often contained within employment contracts, although they may also be separate documents.
Are They Enforceable?
Enforceability of non-competes varies by state. In Pennsylvania, restrictive covenants are generally enforceable under certain circumstances. However, agreements that are overly broad may be thrown out.
So what makes a non-compete “overly broad?” Pennsylvania courts generally frown upon any provisions that would unreasonably restrict an employee’s ability to find gainful employment in his or her field after termination. That means that PA courts are likely to go over any restrictive covenants with a very critical eye.
Courts usually consider three criteria when determining if a non-compete is overly broad:
Whether the agreement is necessary to protect the employer’s legitimate business interests, rather than simply restricting the worker’s ability to find another job
Whether the agreement is in force for a reasonable, limited amount of time
Whether the agreement pertains to a limited geographic area, such as a certain number of miles from the employer’s location
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Of course, the enforceability of non-competes can be highly complex dependent on your particular agreement and employment status.