Being laid off from your current job is always a stressful thing, especially if it is your only means of income. Layoffs or retrenchments occur when the company is downsizing, restructuring, or shutting down. It has nothing to do with the employee’s performance and so, most companies and businesses offer severance pay or separation agreements for the employees they have to terminate.
Separation packages are often provided to employees as a sign of goodwill from the employer. The amount is usually based on the length of the employment of an employee. This also guarantees that the retrenched employee will not retaliate against the company and will be able to retain a good relationship with them. After all, you should never burn bridges because when everything goes back to normal, you may be requested to go back and work with them again.
But did you know that you can negotiate for a reasonable severance package, especially when you have an existing employment contract?
Know The Requirements
When you get laid off, your contract can give you protection specifically if there is a clause about separation pay.
Find out the details of your separation package in your contract and compare it to what is being offered. This will let you know exactly what you can negotiate. Also, you can ask a trusted colleague or friend to look over the agreement before signing anything.
Know How Your Severance Package Is Computed
Severance packages are computed through various factors: from the length of your employment to the reason why you were laid off. You can negotiate not only monetary compensation but also some benefits like insurance coverage or additional payments for unused vacation or sick leaves. Make sure you don’t leave anything on the table and you can also leverage it with the reason for the retrenchment.
Ask all the questions and exhaust your options. Find out if there’s another reason why you are being laid off and if there is a possibility that the company can transfer you to another department or another location.
Know Your Work History
When you discuss your severance pay, your work history will be examined. As being retrenched is not due to the personal performance of the employee, it can still affect the negotiation for the severance pay. Prepare your supporting documents that reflect your work history to counter the review about your job.
These documents can be useful to appeal for an increase in your severance package and also provide you with extra leverage during the discussions.
If your work history is not notable, then it will be an uphill battle as to why you deserve more.
Ask For Advice
Before you accept any severance package proposal, always make sure to get expert advice from your trusted business mentors or lawyers.
This is important because they can tell you if anything is missing in the proposal and if the package is not sufficient enough in exchange for your services before. They can also explain in detail how you can negotiate to the company to obtain a better agreement.
Getting an expert to help you will also be ideal if your severance package comes with non-disclosure or non-competitive clause since this will limit the places you can apply for in the future.
For example, my friend had a non-competitive clause in her contract that she did not realize when she acknowledged her severance package. Now, a Fortune 500 company wanted to hire her but she cannot be employed due to the said clause. She had to wait for a year before she can join any company within the same industry. It was truly a wasted time and opportunity!
Make It Reasonable
If you want your negotiations for your severance package to succeed, always have a reasonable proposal.
There are many reasons why you have been laid off and your employer may not be able to provide your severance pay request because of the company’s budget cuts. Therefore, it is important to be reasonable and negotiate the severance package that can work for both you and your employer. As mentioned before, you can look into other benefits like the continuation of your insurance coverage for the rest of the year or payments for the unused leaves.
Read before you sign
Before you sign your severance package, make sure everything is clearly explained to you. Check all the terms, amounts, and details to make sure nothing is wrong and left out.
If there are questions or doubts, best to clear it with the HR and your supervisor before you sign on the dotted line.
Keeping Quiet and Professional
If you successfully managed to negotiate what you asked for, please keep it to yourself. Sharing the conditions of your severance package to your colleagues is just rude and unprofessional. Some employees may not be able to get a package as good as yours and this proud attitude will just make them feel worse. Be empathetic and professional even on your last days at work.
Read More: 4 Things That Can Get You Fired Immediately
When you negotiate for your severance pay, you must remain realistic and stay focused. It will help you to stay open-minded and be professional as you work all the details out. Finally, always review your contract against what is being offered to you, and if you can, ask for advice before you sign the severance agreement.
But most importantly, don’t be too hard on yourself. I always believe that when one door closes, it is to make way for another door of opportunity to open.
Coping with job losses, know that you are never alone in this. Here are some ways you can cope:
Conversation with Patty Wolters on Unemployment During Pandemic Times
You Are Fired! What comes next?
Feeling Ashamed of Being Unemployed
5 Things You Need To Do While You’re Unemployed
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