Severance, Employment and Non-Compete Agreements

Severance Agreements and Releases

These agreements, usually written by the employer’s attorney, ask an employee to sign away numerous rights in exchange for payment of money. You will be asked to sign one when you are fired or laid off or as a part of an agreement to end your employment. Know that if you sign and take the money, you cannot come back and sue your former employer for any claim mentioned in the agreement. Don’t sign those rights away without having them explained. Employers have lawyers and you should too.

There is no magic formula for how much you are entitled to or should be paid for signing a severance or settlement agreement, as each situation is different. You need the advice of counsel regarding whether you have a viable employment claim that would potentially entitle you to more money than is being offered, and whether you should negotiate for more money, pursue a claim or sign. Employers do not have your best interests in mind. The employer’s attorney probably drafted the agreement. Because you will be asked to sign an agreement with legalese that may not make sense to you, get some help. We can explain what you are signing away. Common provisions employers ask employees to sign include noncompete clauses, confidentiality clauses, prohibitions on reapplying for work, non-disparagement clauses, arbitration agreements and many others.

Settlement Agreements

Although the names of agreements can be interchangeable, these agreements are used when an employee makes an employment related claim and the parties come to a settlement agreement. Be careful what you sign as it may be enforceable even if it is quite simple and handwritten. There are multiple court decisions where an unrepresented employee signed an agreement then tried to change their minds, but the court would not allow it. 

I already signed. Is there any way out?

If you are 40 years and older and the agreement waives any age claims, you may have 7 days to revoke your agreement and pursue more money. We recently helped an employee revoke their agreement using this argument and got them more than twice as much money as they originally agreed to.

Employment Contracts

Do not sign your career away. Most unrepresented employees are at a disadvantage in the hiring process. You are excited to get a job and want to sign whatever the employer puts in front of you. It is almost always worth the expense to have an attorney look over the agreement. We often see the agreements after something goes wrong later in the employer/employee relationship. While we can sometimes still help, it saves considerable expense and creates a better outcome if we provide guidance up front. For example, is there a noncompete clause that is too broad? Are there non-solicitation provisions that will tie your hands if you leave? Are the compensation provisions sufficiently and clearly defined? How are fringe benefits addressed? Is the ownership of intellectual property addressed? Is the agreement "at will" or can "just cause" termination provisions be added? What happens if you want to quit? Getting advice is worth your money.

Non-Compete Agreements

As noted above, employment agreements and releases often include non-compete agreements. In Kansas, these are enforced unless they are unreasonable. Courts are inclined to enforce these agreements. Therefore, you should get it right up front. You do not want to leave your employment for a better opportunity only to discover you are prohibited by a noncompete clause that could have been avoided or at least negotiated to a more reasonable scope. Also, prospective employers are gun shy when hiring someone with a non-compete.

If you are already subject to a non-compete, we can advise you about its enforceability and what your options are. Not every non-compete is enforceable as written.

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