Negotiating a Better Severance Package
Don't just accept a pink slip. Learn how to improve your parting perks.
March 5, 2009 — -- When my friend Natasha was laid off from her administrative assistant job just before Thanksgiving, she didn't take it lying down.
Along with her pink slip, Natasha was offered two weeks' severance pay -- provided that she signed a confidentiality agreement. Although Natasha had only been with the company six months, she jumped at the opportunity to make a play for some extra pay.
"I said, 'If I do sign this, would you consider giving me four weeks' severance instead of two?'" Natasha told me.
"Normally that's not my thing to have the cojones to say, 'Give me more money.' But I figured, What the hell? I'm getting let go anyway."
Happily, Natasha's boss took the bait and gave her the two weeks' extra pay.
Every layoff is different: Not all companies have the cash to keep you afloat for a couple of months, let alone a couple of weeks. And not all employees have the clout or seniority to qualify for those coveted parting perks.
Let's assume that your company offers -- and your role commands -- some semblance of severance compensation. How do you ensure you get the best possible deal if you suddenly find yourself downsized?
Though you may feel like ranting and raving upon losing your job, now's the time for putting on your poker face and staying professional, pleasant even.
Most career coaches and employment attorneys will advise you to negotiate any severance package you're offered before signing on the dotted line. Not necessarily on the spot like my pal Natasha did, but after you've taken a day to read the paperwork you're handed, play with your calculator and talk it over with the rest of your household.
Then back you go to your boss or HR, armed with phrases like "I'd like to discuss some of the specifics of this package," "Is there any flexibility on this?" and "Would you be willing to give me X?"
Some experts caution that trying to negotiate with your employer like this constitutes a rejection of their severance offer, which in extreme cases could lead to them retracting it altogether. But most experts say that they've never actually seen this happen.
"In general, companies don't make emotional reactions -- employees do," said Jason Stern of SeveranceAttorney.com, an independent lawyer in New York who's specialized in severance negotiations for 15 years.
