Severance Agreements

When terminating an individual's employment, some employers will use a severance agreement to shield themselves from any and all liability. Employers may offer favorable terms in the agreement as a token of their generosity, or to lure an employee to sign a severance agreement that provides powerful legal protection for the employer. These agreements are usually drafted by the employer's attorneys, and thus are drafted for the employer's benefit. In many situations these agreements may be what is best for you, but this is not a decision that should be made alone. While many of these agreements seem straight forward and simple, there are often hidden dangers within.

Severance agreements serve one purpose: to protect the employer. In order to accomplish this goal, the agreement will effectively waive all of an employee's legal causes of action which they could otherwise bring in court from the beginning of time to the date the severance agreement is signed. This is usually achieved through a long and convoluted list of separate rights an employee will waive if the agreement is signed. Other common clauses in these agreements include:

  • Confidentiality clauses
  • Non-disparagement clauses
  • Good bye forever clauses

Many employers give a severance agreement to an employee with twenty one (21) days or less to consider the offer or face termination. It is important to understand that signing this severance agreement is only one of your options. In some situations, you may have a legal cause of action against your employer that would be waived if you signed the agreement. When faced with a severance agreement, it is important to seek legal counsel to determine whether signing the agreement is the best course of action for you.

Employers do not read and interpret legal documents alone, and neither should you. Call Wrady and Michel, LLC today so that our experienced employment lawyers can review your severance agreement and give you all the tools you need to make the best decision. Our attorneys review and negotiate severance agreements with employers to put you, the employee, in the best possible situation when faced with the decision on whether or not to sign a severance agreement. We protect employees throughout the state of Alabama, so call today!

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