Negotiating Severance

Negotiating severance is the process whereby an employee who has been informed that he will be laid off receives a severance package deemed to be adequate. When an employee is informed of his impending layoff, certain employers might attempt to force them to sign an inadequate severance package. However, legal experts warn against employees signing this under duress. Rather, it is advised that they find out how much notice they have (i.e., is it within state and federal guidelines), and make sure all accrued benefits are included (sick leave and vacation time). They should also see if the severance pay they are about to receive is commensurate with their time under the company's employ. Employees in a peculiar situation might be advised to seek legal counsel, especially if their rights might be violated.

Fast Facts

  • In 2001, 5% of professional workers negotiated their severance packages. In 2008, 31% did.
  • In June 2009, the layoff rate had grown 20% since the last quarter of 2007.

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