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Severance Negotiations

Joe Louis, one of the greatest fighters of all time, was known in the fighting world as the best finisher of his generation. A finisher in the boxing world is someone who finished a fight in the final rounds with a flurry of aggression hoping for a TKO. Louis was known to land multiple solid punches while his opponents were in the act of falling to the mat.

If you are an employee in the final rounds of an employment relationship that is going bad, don’t expect things to suddenly get better. Your employer isn’t going to acknowledge your concerns, no matter how legitimate they may be, because it’s likely that they have already made a decision to fire you, found your replacement and made operational changes for the transition after you’re gone. You may not be aware of it, but your employer is preparing to finish you off, and any efforts by your employer which suggest a different outcome are just a smokescreen.

When you reach this delicate phase, you know it – you wake up in the morning with a knot in your stomach, you don’t eat or sleep well and your spouse and friends are all telling you to look for another job. You are probably driving your loved ones crazy with your impatience and irritability. You’re on your way to the mat and your employer is swinging, and you aren’t fighting back.

Shake it off, get up, and start swinging for your life. You’re not going to salvage your job, but you can salvage your reputation and self-respect, and secure a reasonable severance package. Severance is not a right, but it is a very common benefit conferred by most companies in the event of a layoff, restructuring or termination for cause. And as much as an employer may insist that severance pay is based on a standard formula, our experience suggests otherwise – it is a benefit that varies based on many different factors, not the least of which is the preparedness, poise and aggression of the outgoing employee. Understand that employers often intentionally offer no severance or a smaller amount than they are prepared to pay knowing that you may retain a lawyer and attempt to negotiate for more. All too frequently, employees leave money on the table by failing to recognize this, or by attempting to negotiate without a lawyer when their employer has little incentive. Also, employees with potential legal claims are more likely to get more severance pay, and many if not most terminated employees are not even aware that they have legal claims and leverage in a severance negotiation.

Remember, don’t hang on to fantasies because you will play into your employers’ hope that you will not notice their sleight of hand in setting you up for termination by creating a negative performance history. The biggest tip-off is the issuance of “progressive discipline,” i.e. oral and then written warnings, or a performance improvement plan, with criticism which is inaccurate, unnecessary or blatantly untrue. Employers are taught that employees who resign or are terminated for cause are unlikely to bring legal claims, and they try to arrange for those outcomes. Take it to them and don’t let them finish you off. Hire a lawyer and be the finisher.