Virginia Severance Agreements
Our Virgina employment lawyers represent and advise individuals in severance agreement negotiations with employers. This often involves reviewing proposed severance agreements and negotiating with an employer about compensation, references and other terms. When evaluating a severance agreement it is important to have a Virginia employment attorney represent and advise you.
Virginia Considers Most Employees At Will
In Virginia, most employees are considered “at will,” which generally means they can be terminated or resign at any time. Even if they are “at will,” when an employee’s employment ends, an employer may offer severance to an employee in exchange for the employee’s waiver of rights. This waiver can include the right to file a lawsuit for any work-related issues. In Virginia, in the absence of an employment contract, an employer usually has no obligation to provide an employee severance pay. However, if severance pay is offered, an employer will almost always provide the employee with a severance agreement. It is important to obtain legal advice and review before signing such an agreement.
What is a Severance Agreement?
In Virginia, a severance agreement is a contract between an employee and an employer that spells out the terms of an individual leaving their employment. Severance agreements can be offered in cases of terminations, resignations, layoffs and retirement. These agreements may be offered in other types of situations as well. In order for a severance agreement to be valid, it must usually provide something of value to the employee to which the employee is not already entitled. For example, in most cases, a certain financial sum is provided to the departing employee by an employer in exchange for a waiver of rights, usually referred to as a general release, by the employee. For example, a severance agreement may provide for the payment of 5 months of salary in exchange for agreeing to the terms in the agreement.
The Law Requires Time to Consider the Agreement
Additionally, in Virginia and many other states, employers are generally required to provide an employee time to consider a severance agreement before signing. The Older Workers Benefit Protection Act (OWBPA), in part, requires that an employer provide employees over 40 years of age with a 21-day consideration period, or a 45-day consideration period in the case of a large reduction-in-force (RIF), and at least a 7-day revocation period. Often, employers rush employees to sign a severance agreement and do not adhere to the procedures for severance agreements. The terms of a severance agreement are generally negotiable between the employer and employee. However, an employee will not necessarily be told this when the employer offers the severance agreement.
Considerations in Negotiating Virginia Severance Agreements
Some of the issues to consider in advance of signing a severance agreement may include, but are not limited to, the following:
Financial terms and timing of severance payments
Tax consequences
Non-disparagement clauses
Re-employment/re-hiring possibilities for departing employee
Continuation of employment benefits (i.e. health)
Unemployment compensation issues
Which claims are waived
Confidentiality terms
Scope of non-competition after leaving employment
Preservation of trade secrets
References and points of contact for prospective employers
Recommendation letters
Consequences of violating the severance agreement
Severance cases must be dealt with quickly and appropriately, with the assistance of counsel. Each severance case is different and an employee may need legal representation in negotiating a severance agreement. Before an employee signs a severance agreement, he or she should consult with an attorney to discuss the rights that he or she may be waiving and the terms of the severance agreement.
Contact Us
If you need assistance with negotiating a severance agreement in Virginia, please contact our office at 703-668-0070 or at www.berrylegal.com to schedule a consultation.
