Separation Agreement
Separation agreements are also called severance
agreements and termination agreements. They often
include one or more among severance, non-disclosure and non-compete clauses.
A separation agreement specifies the terms of your employment
termination when you quit, or get fired or laid
off. It might waive some
of your employee rights, such as your right to sue your former employer.
As with a severance agreement, your
employer likely may require you sign a separation agreement to receive
your severance pay or extra severance pay.
Your employer may not, however, coerce you
into signing a separation agreement, such as by withholding final
pay you've already earned.
Separation agreements may work the other way around too. For example,
if your employer would like for you to resign, but wants to avoid the potential legalities in
forcing you to resign, you might have leverage to negotiate a separation
agreement to your advantage, such as receiving severance
pay and uncontested unemployment
benefits.
Consider consulting an attorney if
you don't feel comfortable negotiating a separation agreement on your own
(or if your employer is forcing you to resign).
Separation agreements are typically enforceable in the states, if they
are reasonable in scope. Once signed, it typically takes a court decision
to determine whether or not a particular separation agreement is reasonable
in scope. But, the power of an attorney behind
you might enable you to negotiate revisions to (or break) a separation
agreement out of court.
If you have questions or doubts about signing a separation agreement,
it's a good idea to consult an attorney.
To avoid enforceability problems, your employer likely will give you a
reasonable amount of time to sign, so that you may consult an attorney
first. Consulting an attorney first will likely cost a fee, but it could
save you a lot of heartache and much more in legal expenses down the road.
See About Employment Contracts and Agreements for
additional information.
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