1. Home
  2.  → 
  3. Employment Law
  4.  → 3 Things To Understand Before Signing A Separation Agreement

3 Things To Understand Before Signing A Separation Agreement

On Behalf of | Mar 1, 2023 | Employment Law

If your employer approaches you with a termination, lay-off or any other form of end-of-employment action, it is possible that you will receive a separation or severance agreement that they expect you to sign.

Separation agreements can be mutually beneficial to both parties in some cases, especially if a generous severance package is on the table. Regardless of circumstances, however, it is important to understand a few key aspects of your separation agreement so you can avoid possible trouble later down the road.

1. Release Of Liability

You should take particular notice of any terms in your separation agreement that release the employer from specified liabilities. This could entail that you are no longer able to pursue legal action against the company for discrimination, unpaid wages or other wrongful acts.

2. Non-compete Clauses

If your separation agreement contains a non-compete clause, you might not be able to work for similar companies for a specified number of months or years. Failing to understand such a clause can land you in serious legal trouble, especially if you are adamant about continuing your career in the same field.

3. Confidentiality Obligations

Similar to non-compete agreements, failing to fully understand what your separation agreement prohibits you from discussing can also result in severe consequences. Check for any non-disclosure clauses in the agreement and keep in mind that you might even be unable to discuss the separation agreement itself.

In an amicable work environment, separation agreements can serve to protect the rights of both employer and employee. Malicious intentions can always dwell under the surface, though, so it can always be prudent to seek professional help in reviewing your separation agreement before signing.