The termination process at a business is one of the most difficult parts of any employer/employee relationship. When an employee is no longer needed at a company, a severance agreement is often used to ensure a smooth and fair termination process. Although a severance package is only a requirement if it is included as part of an employment contract or stated in an employee handbook, a legal contract is beneficial for both parties.
However, negotiating fair severance can be legally complex and emotionally charged. To avoid misunderstandings, it is recommended that both parties have guidance and support from a knowledgeable Cook County severance agreement lawyer. An experienced employment agreements attorney could place the focus on the economics of the situation and negotiate a fair outcome for both sides.
A severance agreement is a legal contract that describes the benefits an employee is entitled to upon termination of employment. It covers various topics, such as ongoing pay, health insurance, and other benefits. The contract typically also includes clauses that prevent the employee from filing a future lawsuit against the employer.
Severance pay is usually negotiated based on an employee’s length of employment, providing a week of payment per year of service. The contract should also include information regarding payment for unused vacation time and other PTO that was earned and unused. In some cases, an employee may be entitled to commission on completed or pending sales and benefits such as profit-sharing and a 401(k).
Employees are entitled to continue health coverage under the Consolidated Omnibus Budget Reconciliation Act (COBRA) for up to 18 months after termination, but the employee is required to pay the full price of premiums. The contract should document that the employee has been offered the option and whether they chose to accept.
In some cases, a severance agreement includes assistance for helping an employee find another position. The contract should define any employer-provided benefits (payment for services from an employment agency), whether an employee is eligible to apply for unemployment benefits, and if future re-employment is an option.
In return for a severance package, an employee usually agrees to waive certain rights to protect the employer. Clauses may include the following.
An experienced Cook County severance lawyer can help employees understand the nature of these agreements and determine what is in their best interests.
Cook County employees are not required to hire a lawyer to sign a severance agreement. Yet, it is strongly recommended to ensure employees know their rights and receive the best outcome possible.
A severance agreement is typically used when an employee is involuntarily separated from their position. However, it can also apply to specific situations in which an employee chooses to leave. A knowledgeable attorney can help employees understand their rights to post-termination benefits and the requirements they must uphold based on the agreement. The terms of a severance agreement are typically negotiable, and an attorney familiar with severance agreements could help an employee get the most favorable terms.
A severance agreement is a complex legal document designed to provide favorable terms for both employers and employees when parting ways. Whether you are an employee or employer, seeking legal counsel from an experienced Cook County severance agreement lawyer could help you avoid conflicts that could impact your future. The attorneys at S.T. Legal Group have extensive experience drafting, reviewing, and negotiating severance agreements. Contact us to schedule a consultation to learn how we could help you develop a contract for an amicable termination process.
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