Massachusetts Severance Agreements: What to Know

Quick Answer: Massachusetts employers aren't required to offer severance, but many do. Severance agreements typically require you to release legal claims against the employer. You have rights to review time, can negotiate terms, and should understand what you're giving up before signing.

Severance is negotiable—know your rights before signing.

Severance Basics in Massachusetts

No Legal Requirement

Key point:

• Massachusetts doesn't require severance
• Purely voluntary by employer
• May be required by contract
• Company policy may create obligation

Why Employers Offer Severance

Motivations:

• Obtain release of claims
• Prevent lawsuits
• Maintain goodwill
• Encourage smooth transition
• Confidentiality of departure

Typical Components

May include:

• Lump sum or continued pay
• Benefits continuation
• Outplacement services
• Reference agreement
• Non-disparagement clause

Release of Claims

What You're Giving Up

Typical release covers:

• Discrimination claims
• Wrongful termination claims
• Wage and hour claims
• Contract claims
• All known and unknown claims

Claims That Cannot Be Released

Protected rights:

• Future claims (not yet arisen)
• Workers' compensation rights
• Unemployment benefits
• COBRA rights
• Whistleblower protections (in some cases)

ADEA Requirements (Age 40+)

If you're 40+:

• 21 days to consider (individual)
• 45 days if group layoff
• 7-day revocation period
• Must be advised to consult attorney
• Must be written in plain language

Negotiating Severance

Everything Is Negotiable

Consider negotiating:

• Amount of severance
• Payment structure
• Benefits continuation
• Non-compete modifications
• Reference terms
• Confidentiality scope

Leverage Points

Your leverage increases if:

• You have potential legal claims
• Employer wants quick resolution
• You have institutional knowledge
• Transition assistance needed

Common Negotiation Items

Often negotiable:

• Severance amount (more weeks/months)
• COBRA payment by employer
• Outplacement services
• Neutral reference letter
• Non-compete release
• Bonus pro-ration
• Stock vesting acceleration

Key Terms to Review

Non-Disparagement

Watch for:

• Scope of restriction
• Is it mutual?
• Social media coverage
• Exceptions for legal proceedings

Confidentiality

Understand:

• What's covered
• Can you discuss with family?
• Future employer discussions
• Legal proceeding exceptions

Non-Compete Provisions

Critical review:

• Is existing non-compete modified?
• New restrictions added?
• Garden leave implications
• Scope and duration

Cooperation Clause

May require:

• Future testimony assistance
• Document provision
• Ongoing cooperation
• Usually reasonable

Timing Considerations

Review Period

Take your time:

• ADEA requires 21-45 days
• Even without ADEA, negotiate time
• Don't sign under pressure
• Consult attorney during review

Revocation Rights

ADEA provides:

• 7-day revocation after signing
• Must be in writing
• Employer cannot waive
• Return severance if revoke

Effective Date

Timing matters:

• When does release become effective?
• When is payment made?
• Benefits continuation start
• Employment end date

Red Flags in Severance Agreements

Overly Broad Releases

Watch for:

• Releasing claims you don't have to
• Future unknown claims
• Third-party releases
• Intellectual property assignments

Hidden Restrictions

Review carefully:

• New non-compete provisions
• Non-solicitation expansion
• Industry restrictions
• Geographic limitations

Unfair Terms

Questionable provisions:

• One-sided non-disparagement
• Admission of wrongdoing
• Forfeiture of vested benefits
• Unreasonable cooperation demands

Common Scenarios

Scenario 1: Layoff Severance

Situation: Offered 2 weeks per year of service.

Analysis: Standard offer. Can negotiate for more, especially with tenure. Review release carefully.

Scenario 2: Termination with Claims

Situation: Believe you were discriminated against, offered severance.

Analysis: Significant leverage. Consult attorney before signing—may be worth substantially more.

Scenario 3: Executive Departure

Situation: Senior role, company wants quick transition.

Analysis: Negotiate enhanced package including stock acceleration, extended benefits, and favorable reference.

Scenario 4: Group Layoff

Situation: Part of reduction in force with standard package.

Analysis: 45-day review period required. Must receive information about who else affected by age group.

When to Consult an Attorney

Strongly Recommended If

Seek legal advice when:

• You have potential discrimination claims
• Substantial severance offered
• Complex non-compete issues
• Senior/executive position
• Unusual terms in agreement

Cost-Benefit Analysis

Attorney review:

• One-time flat fee often available
• May negotiate increase exceeding fee
• Identify problematic terms
• Provide peace of mind

Frequently Asked Questions

Can I negotiate severance?

Yes. Severance is almost always negotiable, especially if you have leverage like potential claims.

How much severance is typical?

Varies widely. Common ranges: 1-4 weeks per year of service, though executives often receive more.

Do I have to sign immediately?

No. Take time to review. If 40+, you have legal right to 21+ days.

What if I refuse to sign?

You don't get severance, but you retain all legal claims. Consider whether claims are worth more.

Related Topics

• Massachusetts Employment Contracts
• Massachusetts Wrongful Termination
• Massachusetts Non-Compete Agreements
• Massachusetts Employment Law Hub

Take Action

If offered severance:

1. Don't sign immediately
2. Request full review period
3. Identify potential legal claims
4. Consult employment attorney
5. Negotiate improvements
6. Understand what you're releasing

Legal Disclaimer

This article provides general information about Massachusetts severance agreements and is not legal advice. For specific advice, consult a licensed Massachusetts employment attorney.

For official information:

• MA Attorney General: https://www.mass.gov/ago | 617-727-8400