Layoffs & Transitions

What's actually negotiable in a severance agreement

Most people treat their severance package as a fixed offer. It almost never is.

Severance is a contract. The company wants you to sign it specifically because signing it releases claims you might otherwise have against them. That negotiating position is worth something, and you have it for exactly as long as you haven't signed.

What tends to be negotiable

The amount. The typical formula is one to two weeks per year of service, but this is convention, not law. If you're in a senior role, have specialized knowledge the company needs during transition, or can demonstrate that your departure created a business disruption, there's room to ask for more.

The non-compete scope. Many severance agreements include non-compete clauses that are written broadly and then negotiated down. Geographic limits, time limits, and which specific companies count as competitors are all worth reviewing. In California, non-competes in employment agreements are largely unenforceable. Elsewhere, narrower is always better.

The non-disparagement language. Most agreements say you won't say negative things about the company. The company should agree to the same. Mutual non-disparagement is standard and worth asking for if it's not already in the draft.

Equity vesting. If you had unvested stock options or RSUs, ask whether any acceleration is possible. This is more common in tech and at smaller companies, but it doesn't hurt to ask.

Benefits extension. COBRA is expensive. Some companies will extend health coverage for a month or two as part of a negotiated package, particularly for longer-tenured employees.

What most people don't know

You don't need a lawyer to negotiate the basic terms. You can write a simple email saying you've reviewed the agreement, you'd like to discuss a few points, and propose specific changes. The company's response will tell you quickly how much room there is.

If there's anything genuinely unusual in the agreement, like a clause that restricts what jobs you can take or requires you to cooperate indefinitely in future legal proceedings, that's when an employment attorney is worth a consultation. Many offer a free first call.

Quick reference

Review window

21 days for employees 40+ under OWBPA

Non-compete enforceability

California, North Dakota, Minnesota ban most. Many other states limit them significantly.

Finding an attorney

NELA.org (National Employment Law Association) has a directory

Negotiation format

Email is fine. In writing is better than verbal.