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In episode 112 of “The JoyPowered® Workspace Podcast,” JoDee and Susan discuss severance agreements with Michael Blickman from Ice Miller LLP.
Employers may choose to offer severance pay to employees who are terminated, either voluntarily or involuntarily. JoDee and Susan discuss the reasons organizations may offer separation agreements. It can soften the blow for those being terminated (and for those not being terminated), can help the company avoid future lawsuits, and can entice an employee to stay for a period of time if needed.
A severance agreement can also be positive for the employee leaving the organization. It gives them continued pay for a period of time, may extend health insurance, may include an agreement not to challenge unemployment benefits, and could offer other benefits, as well.
Employment attorney Michael Blickman joins the show to share his expertise. He explains some core provisions that employers should make sure they’ve included in an agreement, like defining who the released parties are, what claims are being released, and providing for the separation benefit.
Most employees who are offered separation agreements sign them, but they may not want to sign if they don’t understand the agreement or if they believe they want to file a claim against the employer. On the employer side, you may not want to offer an agreement if an employee is terminated for cause, in a union environment, or if you’re not able to meet the employee’s needs.
Most often, employers do not negotiate separation agreements. In a layoff or reduction in force situation, even though the agreements contain confidentiality provisions, it’s likely that everyone will find out, so it’s best to keep it consistent. It’s rare to have to go to court to enforce separation agreements, but they are enforceable. Michael shares some employees’ rights that cannot be released and whether there are federal or state laws that regulate what can and cannot be included in a severance agreement.
Ultimately, separation agreements are usually a great thing on both sides. The employer is generally just trying to help someone on their way out; just because it didn’t work out with an employee doesn’t mean they’re a bad person, and they have a family to support and bills to pay.
In today’s listener question, a listener’s company is getting ready to hire their first HR manager, and they ask JoDee and Susan’s opinions on what to call the role. In the news, Google recently announced that they will return to their company’s physical offices in September 2021 and will pilot a hybrid scheduling model.
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