Bad news: you've been fired. And the last thing you probably feel like doing is negotiating with the person who has just axed you. But that's just what you should do to secure the best possible severance package.
No law says a company must give you severance, although many employers offer it anyway -- typically one or two weeks of pay for each year of service. You have the best chance of getting a better deal if you have a possible legal claim, say for discrimination based on race, sex or age.
Whether or not you do, though, there's nothing wrong with asking for more than the company has offered, says Bonnie Bennett, an attorney with the law firm of Collins, Buckley, Sauntry & Haugh in St. Paul, Minn. Note the number of years you have spent at the company and your record of good service. Find out what other employees have been offered, and let the company know that you have heard about more generous deals.
Companies may be reluctant to cough up extra cash, but they can sweeten the package with a favorable letter of recommendation or by paying for you to receive outplacement counseling. Such items cost the employer little and could greatly ease your transition. Other possibilities: an extra six months of health benefits; and the right to keep a company car for an additional six months, or to buy it for a nominal sum.
If your employer won't improve upon its offer and you think you have a legal case, play your next card, Ms. Bennett advises. "This would be a cost-effective way to address some claims that I have," you could say. The company might then offer to enhance your severance package provided you agree to give up any legal claims.
Asking for such a statement, known as a release or a waiver, does not necessarily mean that the company thinks you have a good case. It might just want to avoid the trouble and expense of litigation. Longtime employees (25 or more years of service) should ask for at least one year's pay in exchange for the release. Other people might expect to receive at least twice the usual severance pay.
Usually you will have a set period of time -- for instance three weeks -- to decide whether to sign the waiver. You can always ask for more time, although the company may withhold the final paycheck until you sign on the dotted line.
But don't sign a release -- or any other document -- without showing it to a lawyer. Also consult an attorney for advice on the tax consequences of your severance or to give you an opinion at the start of negotiations about whether you have a potential legal claim. Keep lawyer costs down by collecting all relevant documents before you meet. These might include the company handbook; notes and memos that reflect company policy; and all evidence of your employment record.
Deborah Jacobs welcomes letters from readers and will address topics of general interest in this column. Write to her c/o Chronicle Features, 870 Market Street, Suite 1011, San Francisco, Calif. 94102. Please include your name, address and telephone number.