Plain-English explanation.
Severance agreements can affect compensation, reputation, references, claims, confidentiality, and future work. The strongest analysis usually starts before the legal label. It starts with the timeline, the documents, the people involved, and the consequences. GB Law looks for the facts that show what changed, who made the decision, and whether the record supports the stated reason.
For clients, these matters can affect income, references, discipline, certification, professional standing, and future work. The goal is not to overstate a claim. The goal is to understand whether the facts support a serious legal strategy and whether the matter is a fit for direct attorney attention.
Does this sound familiar?
- You received a severance offer with a tight deadline to decide.
- The agreement contains a broad release of all claims, including ones you have not investigated.
- There is a non-disparagement clause that limits what you can say about the employer.
- Old or new non-compete or non-solicitation restrictions are being reaffirmed.
- The payment is structured in a way that affects your taxes or benefits.
- You are 40 or older and the agreement includes age claim disclosures.
- You suspect there were legal claims (discrimination, retaliation, wage issues) that the severance is designed to release.
What the law may protect.
Severance is generally not required by law unless contractually obligated. The Older Workers Benefit Protection Act requires specific disclosures and time periods (21 days to consider, 45 in a group layoff, plus a 7-day revocation window) before a release of age claims is enforceable. The Illinois Workplace Transparency Act limits some non-disclosure provisions. Federal and state laws also limit what claims can be released. Some claims (workers compensation, unemployment, future claims) generally cannot be waived.
Different deadlines and procedures can apply depending on whether the matter involves a private employer, public employer, agency proceeding, wage claim, constitutional claim, or administrative decision. That is why early review matters.
What evidence should you save?
- The severance agreement and any prior drafts.
- Your offer letter, employment agreement, and any equity documents.
- Performance reviews and personnel records.
- OWBPA disclosures (group layoff list with ages, if applicable).
- Communications around the termination decision.
- Documentation of any underlying claims (discrimination, retaliation) that may strengthen leverage.
- Any prior severance agreements offered to similarly situated employees.
Deadlines to know.
Many severance agreements include short deadlines, often seven to twenty-one days. Workers age 40 and older are entitled to at least 21 days to consider, and 45 days in a group layoff, under the OWBPA. There is a seven-day revocation period for age-related releases. Once signed and outside the revocation window, agreements are generally enforceable.
Questions people ask.
Do I have to sign a severance agreement?
No. Severance is voluntary in most cases. If you do not sign, you keep your right to sue but lose the severance payment.
Can I negotiate a severance offer?
Often, yes. Severance is rarely a final offer, especially when the employee has legitimate legal claims or significant tenure.
What if I already signed?
Some agreements include a 7-day revocation period under the OWBPA. Outside that window, signed agreements are generally enforceable, but a lawyer can review for exceptions.
How is severance taxed?
Severance is generally taxed as wages. Some structures, such as payment for non-wage claims like emotional distress, may be taxed differently. Tax structure can affect total value significantly.