Newly terminated South Carolina employees are sometimes confronted with the question of whether to sign severance agreements offered by the company after termination. I’ve written previously about the general contents of a severance agreement (read more here), the options around negotiating severance agreements for additional money (read more here), and about the specific provision involving liquidated damages buried in these types of agreements (read more here). But is there a requirement that the employee be granted a specific amount of time in order to review and sign the agreement?
The Time Allowed to Sign Severance Agreements Depends on the Age of the Employee
The answer is yes, in some cases. For employees over the age of 40, the company must meet certain requirements in order to have an effective “release of claims” agreement. In other words, the company wants you to agree not to sue them for anything, thereby releasing your rights to bring a lawsuit. Almost all releases will include a release of age discrimination claims.
Under the Older Workers Benefits Protection Act (OWBPA), in order to release age discrimination claims, then the company must provide you with at least 21 days to consider the agreement AND seven days to revoke the agreement if you change your mind. This law is why employees who are at least 40 years old are given this extra time. If the company is releasing two or more employees as part of a layoff, then the employees must be given 45 days to consider the agreement before signing.
What if the Employee is Younger than 40 Years Old?
For employees who are younger than 40 years old, then there’s no specific requirement that the employee be granted a certain amount of time to consider the agreement. You could be offered the agreement during the termination meeting and told to sign it before you leave the room if you want to get the severance. But in my experience, most companies recognize that employees don’t want to sign a contract without talking with an employment attorney first. Generally, you’ll get at least 7 to 10 days to consider the agreement, and you can sometimes ask for more time if you’re trying to get a consult with an attorney.
I always recommend that an employee have a lawyer review the severance agreement before you sign it. These agreements can contain provisions that may restrict where you can go to work (non-compete provisions), what customers you can solicit at a new job (non-solicit), whether you’ve agreed to onerous liquidated damages, or if you’ve waived your right to a jury trial, among other things. While employees may not have any leverage to negotiate those away completely, they still should be advised on what those provisions mean for their future and how to make sure employees abide by those obligations before they sign severance agreements.
What Do Severance Reviews Cost?
I conduct many severance reviews every single week, and I typically charge $350 to $400 per consult, which just covers the hour that we meet. If we have grounds to negotiate for additional severance, then I may offer to represent the employee on a contingency fee basis, where my fee would be a percentage of whatever I can recover for you above what has already been offered.
If you have questions, please contact our office today at 864-233-4351.
