It is important to understand all of the terms of your severance agreement and the impact that the terms of the severance agreement will have on you in the future. Before you sign a severance agreement provided to you by your employer you should consider the following:
(1) Does the severance agreement contain a non-compete clause. The is a paragraph that will prevent you from working for a competitor or another company for a specific time period — usually 1-2 years in NY and NJ. If the agreement contains a non-compete clause, will it prevent you from working in the future. One thing to consider is whether the severance agreement will compensate your for the entire non-compete period.
(2) Does the severance agreement provide you with all of the benefits that you were entitled to during your employment (401(k), pension, life insurance, etc.)?
(3) Does the agreement contain all promises that were told to you verbally? If the promises are not in the agreement, they will most likely not be enforceable. We commonly see employers promising to pay vacation and fail to include it in the severance agreement.
(4) Do you have any possible claims against the employer that you are waiving as a result of entering into the severance agreement? Most employment attorneys will offer you a free consultation. Take advantage of the free consultation to determine whether you have a potential claim against your employer.
Please call us if you have any questions regarding your severance agreement or would like a free consultation regarding your potential claims.
March 16, 2011 – Castronovo & McKinney, LLC – Tom McKinney