Employment agreements should be fair to all parties. However, most severance agreements are more beneficial to the employer than the employee. Before you are swayed by the money your employer offers you to sign a severance agreement, seek legal advice to protect your rights.
For over 35 years, Herman Law Group has represented employees and businesses. Our vast experience in employment law has equipped us to handle the most complex matters related to employment contracts, including severance agreements. At Herman Law Group, our employment agreement lawyers aggressively protect our client’s rights when they face job termination.
Contact Herman Law Group to schedule a free consultation with our Rhode Island employment law attorney.
How Herman Law Group Can Help You With a Severance Agreement in Rhode Island and Massachusetts
Being prepared for what happens after your employer terminates your employment is important. You may be presented with a severance agreement. The agreement is a legally binding contract. Therefore, you should consult with legal counsel before signing the agreement.
If the severance agreement is not in your best interest, an attorney may be able to negotiate a better offer. Furthermore, an attorney can review the circumstances involved in your termination to determine if your rights have been violated.
When you hire our top-rated Rhode Island and Massachusetts employment law firm, you can trust we will:
- Explain Rhode Island and Massachusetts laws governing severance agreements and employment contracts
- Review the severance agreement to determine if it is fair and reasonable
- Propose changes to the severance agreement to remove or modify clauses that are harmful to your interests
- Negotiate better terms and conditions for the severance agreement when possible
- Take your employer to court if the termination or other action violated your legal rights
Our law firm has received top ratings from our clients and the legal community alike. We have received numerous awards and recognition from national legal organizations, including BestLawyers, Expertise, Super Lawyers, and Martindale-Hubbell. We are members of the National Employment Lawyers Association, the Massachusetts Employment Lawyers Association, the Rhode Island Bar Association and the Anti-Fraud Coalition.
Call Herman Law Group to schedule a free case evaluation with an experienced Rhode Island and Massachusetts employment law and whistleblower law firm.
What Is a Severance Agreement?
If you are fired or laid off from your job, you may be offered a severance package. In many instances, severance agreements are negotiable. Therefore, you should have your own attorney when negotiating a severance agreement.
A severance package may include an amount of severance pay equal to several weeks or months of your salary. It could also include continuing health insurance and other work benefits for a specific period. An employer can offer other consideration in a severance package.
Even though Rhode Island and Massachusetts have regulations and statutes governing how severance and dismissal pay are taxed, the law does not require employers to offer severance pay. Instead, it depends on the company’s policies, the reason for termination, and any employment contract.
Considerations and Legal Implications of Negotiating Severance Agreements
A severance agreement may offer employees the money and benefits they need while searching for another job. However, the agreement may contain one or more clauses that could negatively impact the employee. Considerations and legal implications of a severance agreement include:
Lump Sum vs. Installments
Severance pay may be paid in a lump sum. Often, companies include terms to pay the employee’s severance in installments. Generally, this option is not in the employee’s best interest. The company may stop installment payments before all money is paid, leaving the employee with the expense of hiring a lawyer to sue for the remaining funds.
Non-Compete Agreement
A non-compete clause, also known as a covenant not to compete, restricts the employee’s future employment for a specific period. During the non-compete period, the employee cannot work for a competitor with a certain distance from the employer. The employee cannot start a company that would compete with the employer during that time.
If the clause is drafted correctly and depending on the employee’s position at the company, the non-compete could be enforceable. If so, it impairs the employee’s ability to get another job near where they currently live.
Limits on Unemployment Compensation
Most states do not permit employees to collect unemployment if they voluntarily resign or are terminated for gross misconduct. An employer might insert a clause in the severance agreement stating you are being terminated for cause or quitting. If you sign the agreement, you might not qualify for unemployment benefits.
You can receive unemployment compensation in Rhode Island and Massachusetts if you are no longer receiving severance pay. However, the law states you cannot receive unemployment benefits for any week in which you received severance pay. Therefore, you want to ensure the calculations in the severance agreement comply with the law.
Non-Disparagement Agreement
A non-disparagement clause states the employee will not make any disparaging remarks about the employer. It controls what an employee can or cannot say about an employer after they leave the company. A broad non-disparagement clause includes everything from spoken words to all forms of communication, including social media, text messages, emails, etc.
If a severance agreement includes a non-disparagement clause, it should also prevent the employer from disparaging the employee to anyone calling for a reference for future employment. Something to consider is whether the clause prevents you from explaining your termination. Prospective employers may ask for an explanation of your termination. Depending on your position, non-disparagement agreements may be unlawful.
Non-Solicitation Agreement
A non-solicitation agreement prevents an employee from convincing co-workers to leave the company to work for them or another employer. It also prohibits employees from trying to convince the company’s clients or customers to follow them to another company. A non-solicitation agreement can be enforced if it meets the state requirements for this type of employment agreement.
Waiver of Future Legal Claims
A severance agreement typically includes a waiver of all claims against the company. This waiver typically prevents a wrongful termination lawsuit.
Do I Need to Hire a Severance Agreement Lawyer Before Signing a Severance Agreement in Rhode Island or Massachusetts?
It is in your best interest to review a severance agreement with an attorney before signing the agreement. In addition to the above considerations, other terms in the agreement might harm your prospects. Employment agreements prepared by the employer usually favor the employer to the employee’s detriment.
Schedule a Free Consultation With Our Rhode Island and Massachusetts Employment Law Attorneys
At Herman Law Group, our legal team works to protect the rights of our clients. We can help you with all types of employment law matters. Call now for a free consultation with an experienced Rhode Island and Massachusetts employment law attorney.
Herman Law Group is based in Providence, Rhode Island, and also serves Bristol County, Kent County, Washington County, Providence County, Warwick, and Cranston. The firm also extends its services to Attleboro, Boston, and other locations in Massachusetts, as well as nationwide.