Severance Agreement Checklist: What To Review Before You Sign
A severance agreement usually trades money or benefits for your promise not to sue the company (a release of claims). Read it carefully. Once signed, it's hard to undo.
Deadlines and review periods
If you're 40 or older, the federal Older Workers Benefit Protection Act generally requires that, for your release of age-discrimination claims to be valid:
- You get at least 21 days to consider the agreement (45 days if it's part of a group layoff)
- You get 7 days to revoke after signing
- In a group layoff, the employer provides information about the ages of people selected and not selected
Read the agreement for the deadline that applies to you.
What to check
- ☐ Amount and timing of severance; lump sum or installments
- ☐ Benefits: does the company pay COBRA premiums? For how long?
- ☐ Release: what claims you give up (usually broad)
- ☐ Confidentiality and non-disparagement clauses
- ☐ Non-compete or non-solicitation terms (rules vary by state)
- ☐ Return of property requirements
- ☐ References: what the company will say
- ☐ Equity: vesting or exercise windows
- ☐ Unemployment: whether the company will contest it
- ☐ Repayment clauses if you break the agreement
WARN Act
The federal WARN Act generally requires employers with 100 or more employees to give 60 days' notice before certain plant closings and mass layoffs. Some states have stricter rules. Pay in lieu of notice sometimes appears in severance.
Should you negotiate?
It's often reasonable to ask politely, especially with long tenure, a strong performance record, or unvested benefits. See negotiating severance.
Get advice
An employment attorney can review the agreement, often for a flat fee. Free help may be available through your state bar's lawyer referral service or legal aid.
General information, not legal advice.
The Laid-Off Action Kit includes a severance review page and an editable severance negotiation email.
Laid-Off Action Kit — $12
18-page workbook: first 48 hours, questions for HR, severance review, unemployment, COBRA vs. Marketplace, runway budget and a job application tracker. Instant download: PDF + DOCX + XLSX.
Get the Laid-Off Action KitAll 10 kits — $59More guides
- What To Do After Being Laid Off: The First 48 Hours
- Questions To Ask HR When You Are Laid Off
- How To File for Unemployment After a Layoff
- COBRA vs. Marketplace After a Layoff: How To Choose
- Layoff Budget: How To Calculate Your Financial Runway
- What To Do With Your 401(k) After a Layoff
- Job Application Tracker: How To Organize Your Job Search
- How To Announce a Layoff on LinkedIn (With Examples)
- How To Negotiate Severance: A Polite, Practical Approach