Severance Agreements are agreements between an employee and an employer, usually created and signed at the time that the employee’s employment is ending, or shortly thereafter. Severance Agreements usually grant something of benefit to the employee (often some weeks of severance pay and/or health insurance continuation) in exchange from legal promises made by the employee to the employer. These often included a “release of claims” (giving up the right to sue) and confidentiality and non-disparagement clauses. Although Severance Agreements can be beneficial to employees, sometimes employers will write them in a very lopsided manner, whereby the employer gets the better end of the deal, and will try to pressure an employee into quickly signing the Severance Agreement. Before you sign a Severance Agreement, it is usually worth having an attorney review it, especially if it includes language about a release of claims or limiting the types of work you can do in the future.
