7 Ways to Increase Your Severance Package
Most companies that offer severance packages are willing to increase the offer to those who ask. Here are 7 ways to increase your severance package:
1. Do Not Deal with Human Resources
Human Resources has one goal - to have you exit as efficiently and inexpensively as possible. The Human Resources Department will tell you that severance packages are non-negotiable and that it is a "take it or leave it deal". It is far better to deal directly with someone who knows you - your direct boss or even better is someone even higher up the chain of command who will help you.
2. Get the Company to Agree that they Will Not Contest your Claim for Unemployment Benefits
Unemployment benefits can be a big help when you lose your job. Most states make unemployment benefits available only to people who were not fired for cause. Companies frequently contest unemployment claims by former employees because companies ultimately pay more if they have more claims. If your company offers you a severance agreement, ask them to make it clear that they will not contest your claim for unemployment benefits - few companies deny this request. It will give you peace of mind.
3. Try to Stay Employed by the Company as Long as Possible
It is much easier to find a job if you have one. Do all you can to stay with the company in some capacity so that you can tell job prospects that you are currently employed. Unemployed people have a much harder time getting a job. Avoid that. Be creative - ask to be transferred to any other open position on a temporary basis, ask to be a consultant on open projects you were working on, volunteer, be a freelancer. We have negotiated arrangements for our clients that allows them to still use company email and company voicemail while they work on projects from home or simply agree to consult as needed.
4. Ask for a Pro Rata Bonus
Many people today get a big part of their compensation in the form of a bonus. Companies usually do provide bonuses to people who are terminated before the year ends and bonus payments are rarely included in severance agreements. But if you worked for the company for part of the year, then you should get a pro rata share of your bonus. For example, if you worked six months of the fiscal year before being terminated, then you should ask the company for 50% of your bonus. In certain cases, employees are legally entitled to a pro rata share of their bonus, especially if their bonus makes up the bulk of their income.
5. Ask for Early Vesting of Stock or Options
If you receive stock or options as part of your compensation, they are probably granted to you on a vesting schedule. If your termination date is close to a vesting date, then ask our employer to accelerate the vesting of those stocks or options.
6. Extend Your Health Benefits
COBRA payments can be expensive. Try to stay on the company health plan as long as possible. If you are offered four months of severance pay, ask to stay on the company health plan for four months as well. If they deny this request, then ask them to make the first four months of COBRA payments for you.
7. Ask for More Money
The last and most important thing to do is ask for more severance pay. If the company has offered you three months of severance pay, ask for six months. Be prepared to explain why you should get more severance pay. Point out the results of your work or company loyalty or explain hardships such as kids in college, just bought a house etc. The point is to just asking often puts more money in your pocket. Do it politely.
When you need help from an experienced employment law firm, please give The Ottinger Firm, P.C. a call at 866-571-5010.
