Severance Agreement Review and Negotiation for Employees
Before signing a severance agreement, remember:
The first offer is not always the final offer, and the agreement may contain far more than what your employer summarized for you. A severance agreement is a legal contract, and signing it may mean giving up important rights, including the right to bring certain employment-related claims against your employer.
Review of severance and separation agreements before you sign.
Advice on release language, restrictions, and negotiation options.
Practical guidance on timing, leverage, and next steps.
Plain-language guidance for employees reviewing severance and separation agreements.
Why a Severance Review Matters
A severance agreement often involves much more than compensation, including legal rights and post-employment restrictions. In exchange for severance pay and benefits, an employer may ask you to release legal claims, accept confidentiality or non-disparagement terms, agree to cooperation requirements, or take on restrictions that affect you after your employment ends.
The real question is not only how much severance is being offered. The real question is what you are being asked to give up in return, whether the terms are fair, and whether the agreement should be negotiated before you sign.
What May Be in Your Agreement
When we review a severance agreement, we look beyond the headline payment number. Depending on the document, important terms may include:
- The amount and timing of severance pay.
- Bonus, commission, PTO, equity, or benefits treatment.
- A release of claims, which may affect your right to sue over discrimination, retaliation, wrongful termination, unpaid wages, or other employment claims.
- Confidentiality and non-disparagement provisions.
- Cooperation clauses or return-of-property requirements.
- Restrictive covenant terms, including non-compete or non-solicitation language, where relevant.
Many employees are surprised by how much is hidden in a severance agreement. A legal review helps ensure you understand both the benefits and the trade-offs of signing a severance agreement.
Can a Severance Agreement Be Negotiated?
Often, yes. Employers do not always present their best or only offer at the start, particularly when they want a broad release of claims or a clean separation. Whether negotiation makes sense depends on the facts of your departure, the wording of the agreement, the employer’s goals, and the leverage created by the situation.
Negotiation points may include:
- More severance pay.
- Bonus or commission treatment.
- Extended health insurance support.
- Better reference terms or neutral reference language.
- Narrower confidentiality or non-disparagement language.
- Removal or modification of non-compete or non-solicitation provisions.
Not every agreement needs the same strategy. Sometimes the goal is increased compensation. Sometimes it is reducing restrictive terms. Sometimes it is confirming that the agreement is reasonable and signing with confidence.
What Gives You Leverage
Many employees assume they have no leverage once they have been terminated or told their position is ending. That is not always true. A company may offer severance because it wants certainty, a release of claims, a quiet transition, or protection from future disputes.
Potential sources of leverage for the employee can include:
- The facts leading up to the termination.
- Possible discrimination, retaliation, or other employment-related claims.
- Weak documentation or inconsistent explanations from the employer.
- Seniority, compensation structure, or institutional knowledge.
- Terms in the agreement that are especially important to the company.
A lawyer’s role is not just to read the contract. It is to review the agreement in the context of the facts and help you decide whether there is a real opportunity to improve the outcome.
Timing Matters
One of the most common mistakes employees make is believing they must sign a severance agreement immediately. In many situations, employees have time to review the agreement, ask questions, and consult an attorney. For employees age 40 or older who are being asked to waive federal age discrimination claims, federal law may require a 21-day review period for an individual termination or 45 days for certain group termination programs, along with a 7-day revocation period after signing.
Illinois law also imposes review and revocation requirements for certain separation and release agreements, including a 21‑day consideration period and a 7‑day revocation period in covered situations. Even when those specific rules do not apply, it is still important not to let pressure rush you into signing a document you do not fully understand.
Once you sign, undoing the consequences can be difficult.
How we help
At 1818 Legal, we help employees make informed decisions before they sign. Depending on what you need, that may include:
- Reviewing the agreement and explaining the key terms in plain English.
- Identifying red flags, risks, and negotiation opportunities.
- Advising whether the offer appears reasonable based on the facts.
- Negotiating directly with the employer or the employer’s counsel when appropriate.
- Helping you decide whether to sign, negotiate, or decline the agreement.
Some clients want a quick legal review and practical advice. Others want active support in negotiating a better package. We tailor the work to the agreement, the timeline, and the client’s goals.
Frequently Asked Questions
Do I have to sign a severance agreement?
No. A severance agreement is voluntary, but deciding whether to sign should be done carefully because signing may involve giving up legal claims or accepting obligations that continue after your employment ends.
Can severance offers be negotiated?
Often, yes. Whether negotiation makes sense depends on the facts, the language in the agreement, and the leverage available in your situation.
What rights might I be giving up?
Many agreements include a release of claims, which can affect your ability to sue for discrimination, retaliation, wrongful termination, unpaid wages, or other employment-related issues.
How long do I have to review my agreement?
That depends on the agreement and your circumstances. For some employees over 40, federal law may require a 21‑day review period for an individual termination or 45 days in certain group termination settings, plus a 7‑day revocation period after signing. Illinois law may also require a 21‑day consideration period and a 7‑day revocation period for covered separation agreements.
What if I already signed?
You should speak with a lawyer immediately. In some situations, revocation rights or other issues may still matter, and timing can be important.
What should I send for review?
The agreement itself, any cover letter or email, compensation information, bonus or commission details, and a short explanation of the circumstances of your departure.
What Happens When You Contact Us
When you reach out, we start by reviewing the basic facts: what happened, whether there is a deadline to sign, and what documents you have received. If the matter appears to be a fit, we can discuss the likely next step, what type of review or negotiation support makes sense, and the fee structure that may apply.
The goal is to help you make a timely, informed decision before you sign away rights or miss an opportunity to negotiate.
A short legal review now can make a significant difference in what you receive, what obligations you take on, and what rights you keep. If you have been given a severance agreement, 1818 Legal can help you understand the document and decide what to do next.