Here's how to get the best exit package after a layoff
To help dull the pain of a layoff, many employers offer severance packages to workers.
There’s often no legal requirement for companies to offer these parting gifts, but they serve a couple of key purposes: helping companies avoid negative press and the potential ire of thousands of resentful workers who air their grievances online.
Another upshot of these exit packages if you've been laid off: It may be possible to negotiate an even better severance agreement than what is initially offered.
Here's what to know about these agreements, what they often include, and which components are easiest to negotiate.
Severance pay
It’s totally up to companies to decide how to calculate severance pay, but it’s often doled out based on how long workers have been with the firm. The longer your tenure, the juicier your exit package might be. For example, you might receive two to four weeks of pay per year of service.
In a recent mass layoff at Google, workers received 16 weeks of pay, plus two weeks for every year of service. If you feel your severance pay does not measure up to how many years of service you contributed to the firm, you could push back and ask for more. Another tactic to consider is asking for your pay upfront in a lump sum versus having it doled out over time.
Accelerated stock vesting
Workers who stand to lose any unvested equity they hold after a layoff could push back and ask to be “made whole” in some way. You could ask the company to speed up your vesting period, so you can cash out a portion or all of your stock before you’re terminated. You could also ask for a lump sum cash payment equal to the total or partial value of your stock as part of your exit package.
Unused vacation/sick days
Be sure your employer has properly calculated how many days of unused vacation or sick leave they are offering in your package. If it doesn’t line up with your record of how many days you’ve used, you could ask for an adjustment.
Job placement assistance
It’s common in mass layoffs for companies to offer job assistance to terminated workers to help them get back on their feet. If your severance package doesn’t include this kind of service, you can request it. These services can match you with specialists or coaches who can help you spruce up your resume and LinkedIn profile and help you find jobs in your area of interest.
Health benefits
You might have heard of COBRA, which is a federal program that requires companies with 20+ employees to offer workers to extend their same health care coverage for a period of time. COBRA doesn’t come cheap, because often employers will drop their contribution to your plan, which means you have to foot the whole bill. If you make a strong case to your employer for why you need continued health care support, however, they might agree to continue covering their portion of your bill for more time.
Bonus payout
You might have a case for arguing that you deserve at least a partial payout of your annual target bonus — especially if you can illustrate that you’ve met or exceeded your goals for that point in the year.
Don’t sign the document until you’ve had ample time to review
You might even want to let an attorney review the document with you to point out any concerning clauses — especially if they try to limit your ability to speak about your experience working there or prohibit you from working at competitors.
Success isn’t guaranteed
Go in with realistic expectations before you try to negotiate.
When companies carry out mass layoffs, they aren’t likely going to be as willing to offer individual workers special accommodations or exceptions to the terms of everyone else’s agreements. If you’re part of a smaller firm or you’re one of few workers getting the boot, your chances at striking a unique deal for yourself might improve.
Mandi Woodruff-Santos is a career coach, award-winning cohost of Brown Ambition and founder of the MandiMoney Makers, a one-of-a-kind career coaching community for women of color.
Read the latest financial and business news from Yahoo Finance
