Should You Accept A Voluntary Separation?

Should You Accept A Severance Package? You decide to leave your employment, now what?

This is the 9th installment in the "Learn What To Do If  The Employer Is Setting You Up For Termination" series.

The original name of the article was "You Decide To Leave".

However, I've changed the name to "Should You Accept A Severance Package" because it focuses more on severance pay or packages.

You've weighed all the options and determined that it's in you and your families best interest to move on. However, there are some very important considerations you MUST take into account. There are many instances everyday in the American workplace which cause employees to seek or think about ending their present employment. Changes in management or ownership of a company can have a toxic effect on productivity, trust, morale and more.

When these issues are present there will also be a tendency for higher employment turnover. The workplace can become rift with discrimination, harassment, bullying and more. When subjected to these and other employee rights violations the employee must assess what's in his/her best interests. Previous  installments in this series have shown employees that properly prepare and defend against unjust adverse employment attacks tend to get voluntary separation package offers.

Those that don't almost always find themselves simply being "shown the door" by their boss. Employees that establish credibility in compiling evidence the employer can't defend will usually get offered a severance package. If and when you are offered a severance package to "go away" always consult with an attorney on the specifics. Remember the saying, "The devil is in the details". I know from personal professional experience the games some employers will play with voluntary separation offers.

Should You Accept A Severance Package

Severance Pay

Therefore, I certainly wouldn't try to navigate that process without legal guidance and neither should you. Also, remember if your status is employment "at will" you can be terminated with or without a severance offer. First of all what is a severance package? A severance package is benefits and pay employees receive when they end employment with a company or organization. Severance or separation packages are routinely offered for employees who retire or suffer layoff.

Severance pay was created to provide help for those recently unemployed. They also however, can and have been offered to employees that voluntarily resign for various reasons up to and including being fired. As I've said earlier I call these types of severance packages "go away" or "buy you off" agreements. On the surface accepting "getting paid" to go away may sound like a good thing for the employee. Unfortunately, these agreements or contracts usually require you to sign away your right to sue your employer.

Another potential downside is a severance offer could hinder or block your ability to get unemployment compensation. Because of the enormous economic downturn which in 2007 began in earnest and the slow climb back, severance package education is critical for both employer and employee. After hire employees should learn all they can about any existing severance packages either from HR or the employee handbook.

"Pay To Go Away" compensation is based on an exact amount of money the employee receives if taking early retirement, laid off, asked to leave or some other employment settlement. Severance is typically added as separate compensation to regular salary or pay.  The following are some important questions employees should ask about severance offers...

Should You Accept A Severance Package

Does the company have a severance program?
If so...

How do I qualify for severance if I leave this employment?
In the absence of an employment contract or collective bargaining agreement employers are not obligated to pay severance. However, employers can and do offer them for various reasons such as to minimize the likelihood of lawsuits and maintain good will. When employees are terminated for violation of company policy or other misconduct severance is usually not offered.Nonetheless, if your company has a major layoff and doesn't provide at least a 60 day notice it must offer a severance package.

This is a result of the (W.A.R.N.) Worker Adjustment and Retraining Notification Act. Your employer may also require you to sign off on a non compete agreement as part of qualifying for a severance offer.

What types of compensation or benefits does the severance program contain?
Severance packages may offer other forms of compensation besides cold hard cash. In addition to the employee's remaining regular pay, it may include some of the following:

Career consulting
Accrued sick leave or regular leave pay   
Bonuses based on length of service
Medical, dental or life insurance
Stock options
Job search assistance
Retirement (e.g., 401K) benefits
Qualifying for rehire

How does the employer calculate severance?
If an employer has a severance program in place there will usually be specific guidelines used for it to work. The following are a few examples of what is considered when calculating a severance package:

Employment contract versus "at will"
Job title
Length of service
Size of the employer

Should You Accept A Severance Package


Employers that don't have have exact severance guidelines or don't have a severance policy may negotiate with the employee in deciding what severance will be offered. That means NEVER quickly sign or agree to a severance package without first allowing a qualified employment attorney to review it's contents.

Remember the employer is concerned about what's in it's best interest not YOURS. If your employer puts pressure on you to sign immediately then it's decision time. For your boss to pressure you with the threat of signing right now or be let go with nothing is a huge red flag. I would put my request for more time in writing.

I'd request by email so that when the employer responded negatively I'd print the reply and save that record. Fax is another way to have proof of a denied request for more time. I'd put in writing the employer forced an instant deadline of x-date. I would include language of my intent to have a lawyer review the agreement which will take a week or two.

If the employer refuses then I would definitely not sign it. Severance agreements can be rescinded or undone. Remember, you still will have your right to file a lawsuit intact.

Should You Accept A Severance Package

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10th Installment:
"Clearly Understanding your Employment Termination Options"

Along with this "Should You Accept A Severance Package" page, my new sites provides the MOST current changes affecting career seekers and employees. Also, inside tips and tricks from real world situations.

Some employers are constantly working to take away the rights of employees. Follow this link to EMPLOYEE RIGHTS GUIDE, EMPLOYEE WORKPLACE RIGHTS and EMPLOYEE RIGHTS QUESTIONS for the latest employee news you can use!

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