Understanding Severance Agreements: Key Considerations

 

Navigating job loss is challenging, and deciphering the legalese in severance agreements can add to the stress. Being informed about your rights in California is crucial, as these agreements can impact your career and finances long into the future.

Non-Compete Clauses

In California, non-compete clauses are generally unenforceable. State law prioritizes an individual's right to seek employment freely. However, other restrictive covenants, such as non-solicitation or confidentiality agreements, may still apply. Ensure your severance package adequately compensates for any limitations these might impose.

General Release of Claims

By signing a severance agreement, you might be waiving your right to sue the company. It's essential to assess if the severance pay justifies this waiver. In California, the agreement must be clear and not misleading, and you should fully understand what claims you are relinquishing.

Non-Solicitation and Confidentiality Agreements

These clauses may prevent you from soliciting former colleagues or disclosing company information. California courts closely scrutinize these clauses to ensure they are reasonable in scope and not overly broad or restrictive.

Review and Revocation Period

If you are 40 years or older, under the Older Workers Benefit Protection Act (OWBPA), you are entitled to a 21-day period to review the agreement. After signing, you have an additional 7 days to revoke your acceptance. Use this time to consult with legal counsel to ensure your rights and interests are protected.

Seek Legal Advice

Understanding a severance agreement's intricacies is vital. If you're facing such a situation, seeking the counsel of an experienced California employment attorney can provide invaluable guidance to ensure your rights are safeguarded during this process.