Severance Agreements

If you have been terminated, your employer may offer you a severance package. If this is the case, it is critical that an employment law attorney reviews your severance agreement.  From your employer’s perspective, the primary purpose in offering a severance agreement is to get you to waive your legal rights.  In other words, your employer is offering to settle legal claims that you have yet to file and may not even know you have.  In fact, by offering a severance agreement, your employer may be indicating that they think you have legal claims against them.  Therefore, it is essential that you have an employment attorney explain the legal rights you are waiving.

It is important that the severance being offered is fair and reasonable under the facts and circumstances of your employment and termination. Your severance payment functions as an important bridge to your next employment.  In our free initial consultation, the employment lawyers at Baillon Thome Jozwiak & Wanta LLP will conduct a detailed interview to understand your employment and termination.

From this interview, we will identify any potential claims for employment discrimination, hostile work environment, whistleblower retaliation, sexual harassment or other grounds for wrongful termination.  After we have identified any potential legal claims, we will discuss whether the severance agreement should be accepted or whether it is advisable to either pursue negotiations with your employer or otherwise move forward with your employment claims.

Even if we do not identify any potential legal claims, it is important to fully understand the terms of the severance agreement.  Our attorneys will provide a clear explanation of the terms of the severance agreement and how they will impact you into the future.  For instance, sometimes your severance package will place limitations on where you can work in the future or whether you will be eligible for unemployment insurance. 

If you have already signed a severance agreement and received payment, our attorneys can review the severance agreement to ensure that the severance agreement itself did not violate any of your legal rights.  At a minimum, all severance agreements must be voluntarily agreed to with knowledge of the contractual terms in the agreement.  Our attorneys have convinced Courts to overturned severance agreements that were excessively confusing.  In voiding the severance agreement, the Court acknowledged that the severance agreements were provided to former employees at a difficult time and written in a manner that could not be comprehended by the average person.

In additional to being knowing and voluntary, if you are over 40 years old, then the severance agreement must fulfill a number of separate requirements to waive claims under the Age Discrimination in Employment Act (“ADEA”) or the agreement is void.  These requirements are imposed by the Older Worker Benefit Protection Act (“OWBPA”) and require the agreement is written in a manner calculated to be understood by the employee, refers to the ADEA and OWBPA, does not waive future claims, includes compensation beyond what the employee is already entitled, advises the employee to consult an attorney, provides at least 21 days to consider and seven days to revoke the severance agreement.  During lay offs, employers also must provide terminated employees with a list of employees being terminated and employees being retained.  Minnesota Courts have invalidated severance agreements that have inaccurately included employees on the wrong list, even if the number of inaccuracies were minimal.  

Additionally, if you released any type of discrimination claim in the State of Minnesota, then you must have been provided 15 days to revoke your consent to the agreement.  If you were not provided this revocation period, then you may still be able to pursue those claims.

The employment lawyers at Baillon Thome Jozwiak & Wanta, LLP have assisted countless employees in understanding and negotiating severance from their former employer.  It is important to consult with an attorney if you are offered a severance, already accepted a severance, or believe you should have been offered a severance agreement.  With our assistance, our clients can be assured that they are treated fairly.  When you contact us, you will always speak directly with an employment lawyer and you will do so at no charge.  With the assurance that they have been treated fairly, our clients have put themselves in the best possible position to start the next stage of their career.