| It has become a common occurrence to hear or | | | | assuming you win the first hearing and the |
| read about an executive's release from his | | | | employee does not appeal. |
| company, along with the cushy exit package he | | | | Severance should be on the table because it |
| receives on his way out the door. What many | | | | costs a whole lot less. |
| may not realize, however, is that severance | | | | Some owners and execs think that they should |
| agreements and exit packages should not be just | | | | fight every wrongful termination claim. This does |
| the domain of high-paid execs at Fortune 500 | | | | not make financial sense. By offering as little as |
| companies. | | | | two weeks severance with a severance |
| Why? Well, as a gentle reminder, America is the | | | | agreement, you can usually avoid having a claim |
| land of the lawsuit and even small companies are | | | | being filed. Most employees are living paycheck to |
| not immune. Whether it is through the Federal | | | | paycheck and are grateful for any money they |
| Equal Employment Opportunity Commission | | | | receive. |
| (EEOC), Department of Labor, or state and local | | | | The severance agreement usually protects you |
| equivalent agencies, hundreds of thousands claims | | | | against any potential "wrongdoing" and subsequent |
| are filed against employers for any number of | | | | issues with your former employee and costs a |
| reasons. | | | | whole lot less than fighting a claim. Also, a |
| The majority of claims come from an employee | | | | severance agreement strategy is a great one to |
| being fired, released, let go, downsized, laid | | | | have when you want to be done dealing with a |
| off-you pick the phrase, but at the end of the | | | | problem employee but you have not done the |
| day it means that employee doesn't work there | | | | proper documentation. |
| anymore. Wrongful termination claims are filed | | | | Instead of waiting until you receive a claim that |
| even when a company has a good performance | | | | your employee was fired because she is an |
| management process and proper documentation. | | | | elderly overweight disabled minority female, cut |
| Once a claim is filed, you will usually have to hire | | | | out the middleman and end it all before it begins. |
| an attorney to file a response. You will also have | | | | Once a boilerplate severance agreement is written |
| to take time away from supervisors and others | | | | all you need to do is change the name, date and |
| to answer the complaint, which will costs your | | | | the amount of severance. Do this and most |
| business both time and money. A standard denial | | | | employment relationships end pretty quietly. |
| can cost from $2,000 to $10,000, and that is | | | | |