NH Severance Agreements: Good or Bad?
A severance agreement is offered by an employer, to an employee, upon termination or the employee leaving the company. It is a legally binding contract that can be beneficial or detrimental to employers and employees alike. For employers, if you do not draft your severance agreement in such a way that offers a reliable package to your employee while also protecting your business, you could find yourself in a difficult situation. Your finances could suffer or the employee could choose to sue you. If you are an employee and do not feel as though your contract was held up by your employer, you have the option to take your employer to court. For either party, the guidance of a top New Hampshire employment attorney is helpful.
Severance Agreements are an Option
While many employer’s and companies choose to have a severance agreement, it is not a law that an employer offers a severance agreement and is therefore not illegal. If you are an employee be sure to read your pre-employment paperwork thoroughly and ask questions regarding severance agreements before you sign anything. The severance agreement information will be in the paperwork and you could be signing that you are okay without having an agreement. As an employer, severance agreements might be a smart option in the event that you had to fire an individual and they are disgruntled. Having a severance agreement helps to soften the blow a bit.
Severance Agreements Help with Financial Strain
As an employee, when you lose a job even as a result of termination, knowing that you have a severance agreement can help ease the stress of financial worry. As an employer, a severance agreement can be healthy for your finances and it also can be unhealthy for your finances, depending on the situation and how you work things out. For example, if you are an employer and you have written your severance agreement into an employment contract and then your company suffers a financial hardship, you could have to let some employees go.
In doing so, if you have written acknowledgment of a severance package, you have to fulfill that promise to your employees. That could cause you to suffer more blows to your finances by letting employees go and then having to pay them on top of that. On the flip side of that, you could be bringing in many trustworthy employees as a result of being a company that offers a competitive severance package.
When you offer life insurance and health insurance benefits as part of your package, although they are mostly paid for by your employee, they are still administered by the company. Your company will bear the monetary burden of ensuring payments are processed and taking care of insurance plans for those who are no longer employed with your company. This can become a problem if terminated employees are late on payments or they do not inform the company they intend to stop using severance benefits.
The attorneys at the Law Office of Amanda Dowgiert can help employers draft a severance agreement that benefits both employer and employee, as well as represent employees who were not given what was written out in their agreement. If you are in need of their services in regards to severance agreement situations, contact them today.