Unfortunately, layoffs happen and oftentimes come as a complete surprise to those affected. Layoffs also oftentimes come with a severance offer.

Sometimes an employer just offers up the severance free and clear without the employees who have been laid off having to do anything at all to receive it. However, this is not the norm. More often getting the severance is made contingent on the employee signing a severance agreement.

Severance agreements are legal documents and can be incredibly complicated and confusing and leave employees wondering what to do. On the one hand, an employee who has just lost their job clearly wants the money. But on the other hand, that employee may be concerned about what they are giving up in exchange for that money. They also may be wondering if they can get more money. The best way to know for sure is to consult with a Texas Employment Lawyer.

Why were you terminated?

The legitimacy of the layoff is one of the first things an employment lawyer is likely going to analyze before advising you on your severance agreement. Sometimes, employers attempt to cover up discrimination by calling a termination a layoff when in reality it is really just a termination. Additionally, even if the overall layoff is for legitimate business reasons, the layoff selection process can still be done in a discriminatory manner if an employer is selecting the workers it is going to layoff based on their race, religion, national origin, sex, age, or some other protected categories.

Overall, anytime there is a severance offer on the table, layoff or no layoff, the circumstances surrounding the termination are crucial to understanding the severance agreement and providing legal advice.

What you may be giving up

Obviously, what an employee is giving up when they sign a severance agreement ultimately depends on what the agreement says, which is why it is so important to review the documents with an attorney prior to signing. But, generally, the most important thing an employee is giving up when they sign a severance agreement is their right to pursue any legal claim they may have against their former employer.

Typically, a severance agreement will contain what is called a general waiver and release. The release is meant to be as all-encompassing as possible. Keep in mind, the employer’s lawyers drafted the agreement to protect the employer, not the employees who are being let go. Accordingly, by signing the agreement, workers are likely waiving any and all legal claims they may have against their former employer, both known and unknown. Unknown! That’s right, even potential claims the employee does not know about can be subject to the waiver.

The waiver of claims is why the context surrounding the termination is so important. If you likely have no legal claim, then you are not giving up as much up as you would be if you did potentially have a claim. Of course, there could be claims not related to the termination as well, so make sure you bring up any potential concerns with the employment lawyer who you review your severance agreement with.

Additional terms

In addition to the waiver and release of any potential legal claims, severance agreements typically contain a lot of other terms as well. Some of these terms can be particularly important to understand prior to signing a severance agreement because they place restrictions on what the employee can do if they sign.

One of the key provisions that restricts what a worker can do after signing a severance agreement, one that is almost always present, is a confidentiality provision. A confidentiality provision prohibits the employee from discussing the existence of the severance agreement with others. Some agreements may also contain a non-disparagement provision. A non-disparagement provision prevents the employee from saying bad things about their former employer.

Overall, it is important to review any severance agreement with an experienced Texas Employment Lawyer prior to signing so you understand not only what you are giving up but also what you can and cannot do after you sign. It is important to understand what could result in the company down the road trying to say you breached the agreement and owe them money.

Email this postTweet this postLike this postShare this post on LinkedIn
Photo of Julie St. John Julie St. John

We asked Julie L. St. John, an experienced Trial Attorney in the Houston office of Wiley Wheeler, P.C., to impart her candid answers to a range of questions. After reading, you will be more more informed on the well-respected reputation that Ms.

We asked Julie L. St. John, an experienced Trial Attorney in the Houston office of Wiley Wheeler, P.C., to impart her candid answers to a range of questions. After reading, you will be more more informed on the well-respected reputation that Ms. St. John carries.

1. Why did you start practicing labor and employment law?

Because I care about the rights of employees and believe all workers should be treated fairly. 

2. If you could write a new law, what would it do?

Guarantee a living wage for all workers.

 3. Besides Rob Wiley, P.C., what is the most interesting job that you have had?

I worked as the beer cart girl at a golf course in college. 

4. What’s the best part of living in Houston?

Houston is clearly the best city in Texas, way better than Austin or Dallas. The people are wonderful, and the food is delicious. The only downside is the traffic, which is why I refuse to go outside of the loop (with a key exception for Ikea).

 5. If you were not practicing labor and employment law what would you be?

I would start a gardening/landscaping company with animals that do the work. The goats would eat the weeds, the pigs would till the ground, and the chickens would keep the bugs away.

6. Why did you decide to become a lawyer?

To have another tool to use to fight for things I believe in. I’ve always wanted to change the world.

7. What do you do when you’re not practicing law?

Travel, watch Ohio State football, and work to make my cat instafamous.

8. What’s your favorite legal movie

The Pelican Brief because it features Tulane Law!

9. Have you ever learned something from one of your clients?

I learn something from almost all of my clients. Most importantly, courage.

10. Who do you most admire as a lawyer?

Kalandra Wheeler

Julie L. St. John is a Trial Attorney in the Houston office of Wiley Wheeler, P.C. She graduated from Ohio State University with her bachelor’s degree in 2007. Ms. St. John then graduated from Tulane University School of Law in 2017.