Severance Package Negotiation

Half a century ago, it was commonplace for employment relationships to span decades and end with the fruits of a pension plan and well-wishes from colleagues at a lively retirement party. While many c-suite executives, managers, and other employees still stay with the same company until the end of their careers, it is now certainly the exception rather than the rule.

For reasons that may be specific to the employee or because of broader economic and strategic factors, companies and their executives and employees decide to part ways on a regular basis. Often, these decisions catch the employee off-guard and lead to feelings of resentment, unfairness, and betrayal. It can also create worry and anxiety about the immediate and long-term financial future.

Your Company Owes You Nothing. But You Deserve A Lot More.

If you find yourself approaching the end of your employment relationship – whether by mutual agreement or otherwise – you’ll want to close this chapter in your career with as much security and consideration as possible. After all, you’ve likely put in years of hard work and sacrificed a lot serving your company with loyalty and commitment. It’s not unreasonable to expect your employer to show you some respect and gratitude for your efforts in the form of a generous severance package.

But unless an employment contract or collective bargaining agreement says otherwise or you were wrongfully terminated for reasons prohibited by law, your soon-to-be former company owes you nothing. There are no severance package laws in Illinois, no requirement that your employer provide you with weeks or months of severance pay or other benefits (COBRA aside).

This means that securing severance pay and maximizing the benefits of an exit package for yourself and your family will be a matter of negotiation. Your employer likely negotiates severance matters on a regular basis, advised by high-paid lawyers who will propose and draft agreements purposefully skewed in the company’s favor. It may also appear that the company is holding all the cards; after all, you are the one asking for compensation and other consideration.

Masterful Negotiators Who Can Level the Playing Field and Maximize Your Severance

Don’t make the mistake of trying to level the playing field on your own or presume that you need to take whatever your company offers, no matter how inadequate. Negotiating is a skill and an art, and at Siegel & Dolan, Ltd., our Chicago employment lawyers have a mastery of the strategic and tactical aspects of effective exit package negotiation. We have over 70 years of combined experience working with CEOs, c-suite executives, middle-managers, and employees at all levels to maximize the value of severance packages.

Our lawyers bring a wealth of knowledge and savvy to severance negotiations, focusing on each client’s unique circumstances and goals. Obtaining desired results at the end of an employment relationship requires much more than writing a demand letter or making a phone call or two. Negotiations need to begin with a holistic, well-thought-out strategy that takes into consideration the company’s pressure points, followed by the development of an approach designed to leverage those concerns in a positive way.

When you meet with us, we will take the time to understand the history of your relationship with the company, the facts and assertions surrounding your impending separation, and any proposals which your company has made regarding severance. By immersing ourselves in your situation and truly appreciating your concerns and objectives, we can best position you for a successful outcome.

Considerations for Exit Package Negotiation

While Illinois severance pay laws do not generally require employers to offer their employees severance packages upon termination of the employment relationship, they frequently do make such offers, even if it’s not because of the kindness of their hearts.

Employers will often consider former employees’ circumstances on a case-by-case basis when determining whether to offer any type of severance pay. Many factors may affect the employer’s decision regarding severance, such as the former employee’s record with the company, the length of employment, and the circumstances of the employee’s departure.

While an employer may offer an employment separation agreement as a gesture of goodwill, many offer severance for more self-serving reasons. A severance agreement can act as an insurance policy of sorts to insulate the company from liability arising out of the employment relationship. In exchange for extended compensation and benefits, a severance agreement may require the employee to release any potential claims he or she has or may have against the employer. Additionally, a proposed severance agreement might impose new obligations on the former employee, including a promise from the former employee to refrain from certain work or activities.

It can be tempting to agree to such terms when the options seem to be take it or leave it. But if you sign an agreement that takes away your legal rights or puts restrictions on your ability to pursue your career as you’d like, you could be giving away much more than you get in severance pay. Quite simply, negotiating your severance package is not something you should do alone, and you should never enter into such an agreement without first speaking with experienced employment counsel.

Siegel & Dolan: Chicago Severance Lawyers

At Siegel & Dolan, we can help ensure that your severance package is fair, equitable, and complete. We know that how an employment relationship ends can be even more impactful than how it began. The future of your career and your finances are on the line; we never lose sight of that and work tirelessly to position you for a successful and secure transition.

Consult with an Employment Law Attorney

If you have questions about the terms of a proposed severance agreement or would like help negotiating the terms of your departure, please reach out to Siegel & Dolan. Throughout Chicagoland, our attorneys welcome the opportunity to assist you. You can call us at (312) 878-3210 or contact us online to schedule a consultation with one of our severance attorneys. We look forward to meeting with you.