Dr. Curry of The Growth Company, Inc. Reveals Answers To A Client Regarding Severance Pay Contracts

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Due to a clients question, Dr. Lynne Curry reveals the pros and cons to signing a severance pay contract.

To sign or not to sign

the employer’s offer doesn’t necessarily signal a belief that the client has a case.

Today Dr. Lynne Curry, CEO of The Growth Company, Inc., responds to a concerned client regarding signing an agreement to collect severance pay. With some help from a local employment attorney-turned-HR-consultant, Dr. Curry reveals the necessary questions to ask when deciding whether or not to sign away their rights.
“My boss just fired me and handed me an agreement to sign if I want severance pay. If I sign it, I get a month of pay but I have to promise not to sue. Does this mean he thinks I can sue? And should I sign? I’d rather not call an attorney.” Dr. Curry received this letter from a client (remaining anonymous).    
Dr. Curry responds by saying first, “If you’re considering suing your employer and feel you have a good case, don’t sign it. If, however, you have no interest in a lawsuit, sign it; you’ll get a month’s pay in exchange for an easily kept promise.”    
“Ask yourself”, says employment attorney-turned-HR-consultant Richard Birdsall, “why your employer fired you. If your employer had a valid reason, sign and take the money. If, however, this termination violates agreements such as a ‘you’ve got this job for a year’ promise or results from your employer’s prejudicial discrimination, seek legal advice.”    
Dr. Curry adds that the employer’s offer doesn’t necessarily signal a belief that the client has a case. Because employers don’t need to give post-employment pay, some ask for waivers as insurance against frivolous but burdensome lawsuits before they cut severance checks. If, however, the employer actually fears this client may sue, the client may be able to negotiate for additional severance pay or other items such as positive letters of reference.    
Finally, Dr. Curry states, “If you’re handling this yourself, make sure the waiver spells out exactly how much money you’ll receive in exchange for signing the agreement, along with how your employer plans to handle the taxes – i.e., do you get a month’s net or gross pay? Also, take a look at any requirements you’ll need to observe – for example, most agreements prevent you from disparaging your former employer once you accept the money – and assure you your employer won’t badmouth you to prospective further employers.”
The bottom line – severance pay can be a win/win for the client and the employer. Don’t, however, sign before taking a serious look at the offer.
Dr. Lynne Curry is a management/employee trainer and owner of the consulting firm The Growth Company Inc. Send your questions to her at lynne@thegrowthcompany.com

You can follow Dr. Curry on Twitter! @lynnecurry10
© Lynne Curry, November 2012,http://www.thegrowthcompany.com

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