Employee Severance and Release Agreement

If a layoffs rumor circulates through a company, some employees may want to quit to get ahead to look for a new job. But that's not always the best decision.

Even if termination of employment is nearly guaranteed, staying on might be beneficial because of the potential severance package.

The Employee Severance and Release Agreement outlines all the financial terms regarding the employee's departure from the company.

What Is an Employee Severance and Release Agreement?

The most important aspect of the Employee Severance and Release Agreement is the monetary arrangement.

However, this financial cushion is the only element the soon-to-be former employee can negotiate with their employer.

This type of agreement can contain the promise of references, insurance, paid time off, and other perks. There are no clear rules on creating Severance Agreements, but they often offer one or two paid weeks for every year the employee has worked in the company.

The Severance Agreements helps terminated employees to receive temporary financial assistance from the government.

Other Names for Employee Severance and Release Agreement

Depending on your state, and Employee Severance and Release Agreement may also be known as:

• Severance Package
• Severance Pay for Fired Employees
• Severance and General Release Agreement
• Compensation Package

Who Needs an Employee Severance and Release Agreement?

The employer offers the Employee Severance and Release Agreement upon termination of the employment contract.

These agreements are typical when a company eliminates an entire department or position or when the business goes through restructuring.

Another common situation when you offer severance packages is during massive layoffs when the company is struggling.

The Employee Severance and Release Agreements are also helpful to employers as it protects them from specific claims against them.

Why Use Swyft Forms for Your Employee Severance and Release Agreement?

Customized for you, by you

Create your own documents by answering our easy-to-understand questionnaires to get exactly what you need out of your Employee Severance and Release Agreement.

Specific to Your Jurisdiction

Laws vary by location. Each document on Swyft Forms is customized for your state.

How to Create an Employee Severance and Release Agreement With Swyft Forms

The Employee Severance and Release Agreement can be a complex contract. Both parties negotiate the terms to get the most out of it. The Severance and Release Agreement can have as many provisions as both parties find suitable.

Let Swyft Forms help with our extensive library of attorney-vetted legal forms. The process is fast and easy. All you have to do is fill out our easy-to-understand questionnaire. Once complete, simply download your form as a PDF or Word document from your secure online account.

What Information Will I Need to Create My Employee Severance and Release Agreement?

To create your document, please provide:

• Employer's Details: The legal name and the address of the employer or a business
• Employee's Details: Full legal name and contact information of the employee
• Governing Law: Inclusion of the language regarding what state's jurisdiction law to use in the agreement
• Date of Hiring: Exactly when the employee hired for the position
• Date of Termination: The exact date of the termination of the employment contract
• Deadline: When the severance package offer expires
• Liability waivers: A complete list of waivers that the employee will release in the agreement
• Severance Payment: The severance pay amount
• Benefits: Any additional parts of the contract such as insurance, PTO, stocks, references, etc.

Employee Severance and Release Agreement Terms

• Severance: An act of ending, separating; employment separation
• PTO: Paid Time Off; Planned Time Off; Personal Time Off
• Liability Waiver: A type of clause that acknowledges that the employee won't sue the company
• FMLA: Family and Medical Leave Act
• Governing Law: A clause specifying the chosen jurisdiction that the company will use in case of dispute

Employee Severance and Release Agreement Signing Requirements

If the employer offers a severance package to the employee, they usually don't have to sign it right away. They can take the time to review the agreement and see if it is to their satisfaction.

During the same period, the employer can change the terms of the agreement as well. If both parties are satisfied, they sign the document in the presence of a witness.

What to Do With Your Employee Severance and Release Agreement?

Both parties should keep a copy of the Employee Severance and Release Agreement. The employer can store it in the company's HR department, and the employer should also keep it safe. There is no need to notarize the agreement for it to be legally binding.