A sudden loss of employment can be a devastating setback. The average individual does not have enough savings to live indefinitely without extensive treatments. Someone suddenly laid off or terminated from their position usually begins looking for a new job immediately.
However, they may also need to very carefully approach the end of their current work agreement with their employer. Severance packages can ease the transition between unexpected job loss and someone’s next position. Those preparing to negotiate a severance package may want to focus with particular care on the three concerns listed below during those negotiations.
Limiting restrictive covenants
Employers often demand concessions from terminated workers in exchange for severance pay. Restrictive covenants are common requests. Employers may demand that someone sign a non-compete agreement, which could effectively limit their job opportunities. They may also be subject to non-disclosure or non-solicitation agreements. Being very careful when setting the terms for restrictive covenants can help ensure someone has the best opportunities after leaving their current position.
Addressing benefit packages
Severance packages often include a continuation of benefits. Whether someone needs transitional health insurance because of a family member’s medical issues or should receive a bonus based on their performance to date, severance discussions usually need to clarify what should happen with someone’s employment benefits. Ensuring that the company pays out accrued paid leave benefits and that a worker receives any incentive pay, bonuses or insurance that they deserve based on the timing of the termination can make a major difference for someone unexpectedly leaving a job.
Minimizing future reference issues
During severance negotiations and exit interviews, those losing a job may need to discuss their situation with management or human resources. Keeping things as amicable as possible could help reduce the likelihood of unfavorable references in the future. From discussing the decision that led to someone’s termination to verifying the employment dates that a company intends to confirm in the future, there are several details that could influence someone’s references and therefore their future employment opportunities.
The average worker struggling with sudden loss of their employment may have a difficult time handling severance package negotiations and other contractual matters on their own behalf. Those who secure guidance and advocacy when leaving a position may set themselves up for a smoother transition and better prospects in the future.