Laid Off from Work? Negotiate a Severance Package!

Being laid off is one of the most life altering events in a person’s life. For individual families, especially single parent homes, the move from being employed to being unemployed can, quickly, become the difference between shelter and being homeless. As a productive employee, dedicating loyalty to a company, now experiencing a lay off, there are often emotional issues which couple the financial toll the lay off brings.

To avert financial toll, when subject to a corporate lay-off or downsizing, there are steps an employee can take to negotiate items within a severance package. Beyond money, many employees are unsure as to what additional benefits can, and should be, provided by their American employers.

One of the first items that should be negotiated as part of a severance package involves the continuation of insurance benefits which are considered crucial to protecting the family from further financial demise. Such insurance coverage, which should be considered, will include not only health insurance but also short term and long term disability and even life insurance. With many employers opting to process downsizing and severance packages in the form of a lump sum payment to the employee, some employees are negotiating the severance to include continued and regular paychecks, with continued benefits, in lieu of lump sump payment. While COBRA laws protect the rights of employees to continue insurance benefits after a lay-off, it is the negotiation of these benefit, to include continued employer premium contribution payments, which is crucial to the outcome of the severance package.

In addition to continued insurance benefits, those employees who may have been eligible for bonuses, as outlined in company policies, should work to negotiate some form of bonus payment, even if on a prorated basis. Because many employees do not consider this as a severance option, employers are often caught off guard when this request is made by the employee. To not be intimidated by the expressions of surprise by the employer. By outlining a logical basis on which this should be paid, pro rated, many employers will agree and provide the bonus as part of the severance package to the laid off employee.

When participating in severance negotiations, often, the employee feels he is not on the same playing field as the employer. Preparing emotionally, therefore, is crucial to achieving the desired results are part of the negotiation process. Showing the employer that you are an active and optimistic participant, will go a long way in setting the tone for the negotiations process. For employees who approach the settlement negotiations with an attitude of revenge, or as if they are “owed” something, often, will violate the feelings of the employer staff and, ultimately, may lead to negative emotions which will stall or prevent the severance negotiations from proceeding. The key here is to keep your cool.

With the news of a lay off, buy out or downsizing, many employees find they are struck with depression, fear, anger and anxiety. Learning to effectively control these emotions, and articulating your desires and needs are part of a severance package, will work to ensure, to some degree, your financial security and a pleasant departure from the employer.