Atlanta Severance Agreement Attorney

When laying off employees, many companies offer severance pay in exchange for various promises. For example, a non-solicitation clause prevents laid-off employees from recruiting their co-workers to leave for a different job.

These types of contracts memorialize what the employer and employee agree to do for each other after the employment relationship ends. If you plan to lay off one or several employees in the future, talk to an Atlanta severance agreements attorney. The experienced attorneys at Sparks Law can draft documents that protect your company and prevent future problems with disgruntled employees.

What Is a Severance Package?

A severance package is the compensation and benefits package an employer provides to an employee being terminated from their job, typically due to factors beyond their control such as company downsizing, restructuring, or layoffs. It is designed to soften the financial impact of job loss and provide support during the transition period. Severance packages often include a lump-sum payment based on the employee’s time working there, additional pay for unused vacation or sick leave, a continuation of certain benefits like healthcare coverage, and sometimes career assistance funds. The specific components and terms of a severance package can vary widely depending on company policies, industry standards, and individual circumstances.

Understanding the Components of a Severance Package

There are lots of moving parts in a severance package. First, a severance package includes a lump-sum payment based on factors such as the employee’s length of service, position, and salary. This payment is intended to compensate the employee for the sudden loss of income and help them cover immediate expenses or facilitate their job search.

Second, a severance package may offer additional compensation for unused vacation or sick leave. Employees are often entitled to receive payment for any accrued but unused vacation days or sick leave hours. This serves as an additional financial cushion and ensures that employees are compensated for their accrued time off, but usually, this is not guaranteed. 

Other components that may be included in a severance package are the continuation of certain benefits. These can include healthcare coverage, life insurance, and retirement plans for a specified period following termination. The duration of continued benefits varies depending on the company’s policy, but it is generally aimed at providing some stability during the transition period and minimizing the impact of losing access to vital benefits.

Specifics can vary widely, though, depending on factors like company policies, industry standards, and individual negotiations between the employer and employee.

Can the Terms of a Severance Agreement Be Negotiated?

Yes, definitely, the terms of a severance agreement can be negotiated! But, it can be difficult and often requires assistance from a trusted severance agreement attorney. Employers have standard severance packages in place, and leave little room for negotiation even considering the employee’s position, length of service, and individual circumstances. Negotiations primarily surround the amount of the lump-sum payment, the duration of continued benefits, the inclusion of additional benefits, and whether they restrict the ex-employee with confidentiality or even non-compete agreements. Employees should take the highest caution to carefully review and understand the terms of the severance agreement before signing, and if needed, seek legal counsel to assist with the negotiation process. I’m sorry to say, but many employers will not take an employee seriously until an attorney is involved. 

What Happens If a Severance Agreement is Breached?

Breaching a severance agreement is rare, but has significant consequences. Employees who violate the terms of the agreement can lose all remaining severance benefits, the lump-sum payment, and the continued healthcare benefits–they may even have to pay back the lump-sum amount and pay attorney’s fees for the employer. Breaching a severance agreement can limit future job prospects, and leave the employee unable to work in their field of expertise. 

If the employer breaches the severance agreement, they may be subject to legal consequences, too. This could include potential lawsuits from the employee seeking the enforcement of the agreement or compensation for damages incurred due to the breach. Breaching a severance agreement can result in reputational damage to the employer as well, potentially impacting their relationship with other employees or even the company’s customers! It is essential for both parties to carefully adhere to the terms of the severance agreement to avoid these hefty repercussions and maintain a mutually beneficial resolution.

Waiving the Right to a Jury Trial & Arbitration or Mediation for Disputes

A big factor for employees when signing a severance agreement is “waiving the right to a jury trial”. Right to a jury trial is often your best hope for a fair resolution of a case. Waiving this right means the employee voluntarily relinquishes the ability to have their case heard by a jury in a court of law. Instead, any disputes or claims arising from the severance agreement would be resolved through a judge (“bench trial”), arbitration, or mediation. Typically, judges are more favorable to employers than employees.

Arbitration involves presenting the case to a neutral third-party arbitrator or panel, who will hear both sides of the dispute and make a binding decision. It is a formal process that resembles a simplified version of a court proceeding. Mediation involves a neutral mediator who facilitates negotiations between the parties to help them reach a mutually acceptable resolution. The mediator does not make a binding decision but instead assists in finding a compromise that satisfies both parties. The advantages of Arbitration and Mediation over traditional litigation, are cost savings, confidentiality, and a generally quicker resolution. The disadvantages are that employees no longer have the right to sue the employer if the employer breaches the agreement. It is important to carefully review the severance agreement to understand which method of alternative dispute resolution is specified. It is vital for employees to carefully consider the implications of waiving their right to a jury trial, BEFORE signing a severance agreement. 

Wrongful Termination and Your Severance Package

Wrongful termination is the unlawful or unjustified termination of an Employee’s contract. While severance packages are typically provided in situations of voluntary or involuntary job separation, they may also be offered as a form of settlement for wrongful termination. If an employee has been wrongfully terminated, they may negotiate with their employer for a severance package that includes additional benefits or compensation to settle a claim rather than filing a lawsuit. In these cases, severance packages can serve as an alternative means for Employers to resolve potential legal disputes and provide financial support to the terminated Employee. The terms and amount of a severance package in a wrongful termination case require precision and negotiation between the parties involved. Seeking legal advice is absolutely necessary for Employees who believe they have been wrongfully terminated and are considering their options for a severance package.

Get Legal Advice from an Experienced Atlanta Severance Agreements Attorney

At Sparks Law, we understand the challenges both employers and employees face in dealing with severance agreements in Atlanta. Our commitment is to provide excellent legal service to both employers and employees and in matters related to severance agreements. With 10 years of experience and expertise, we protect the interests of our clients and ensure they receive fair treatment during the negotiation or review of their severance packages. Our team of dedicated attorneys specializes in Atlanta severance agreements and is well-prepared to handle your issue. If you are facing a situation involving a severance agreement in Atlanta, contact our skilled attorneys today for personalized guidance on your best solution. Let us help you navigate the complexities of your severance agreement and achieve the best possible outcome for your situation. Contact us today to get started.