Understanding Your Rights and Options in Severance Agreement Negotiations
Even though losing a job is traumatic, you may be able to modify the conditions of your severance payment to meet your requirements better while looking for work. You already know that you will be leaving the firm, so the advantages of bargaining for a better total severance package or greater severance money may outweigh the dangers. Do your homework and be ready to use your employment history as leverage for negotiating severance agreements to secure the pay you are due.
What is a severance package?
While some job seekers may be aware that they can bargain for benefits and pay when they are employed, others may not be aware that they have this option when they leave a company.
A severance agreement, which specifies the financial parameters under which the employee would depart the organization, is typically provided by employers. To negotiate a good deal, you must consider your needs for support regarding money and perks, how you will behave in negotiations with the employer, and if you need to seek legal counsel.
A good cash buffer, stress relief, and an easier transfer to a new career are all possible benefits of negotiating this agreement. But these talks should cover more than just a financial agreement; you should discuss ongoing insurance benefits, help finding new employment, and other advantages.
The fact that businesses do not want you to sue them or disparage them gives you leverage in this discussion. Additionally, they might not want you to work for or divulge trade secrets to their rivals.
Recognize the elements of a severance package.
Severance packages are not the same as severance compensation, but they consist of various elements. For the former employee, this is advantageous since it offers several bargaining points.
There are a few ways you might be able to boost the value of your severance package if your previous company is set on how much they will pay you. Determine each part of your severance package and note if any important advantages are missing to get the most out of it. Typical components of a severance package include:
- Severance pay
The term “severance pay” describes the financial rewards an employer provides to an employee who is let go. Severance compensation typically lasts six months to a year at your prior wage.
- Paid time off
You could be eligible for compensation for the time you have already accrued if you have paid time off, such as sick and vacation days. In their employee handbooks, several businesses outline their paid time off payment procedures.
