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Job Center: The New Rules of Severance

Nearly 700,000 more people were added to the running tally of the unemployed last month, inching us ever closer to the psychological milestone where one out of every 10 Americans is looking for work. And with the average job search now lastings at least five months, by one survey’s count, the safety net provided by the corporate severance package is as crucial to many as ever.

So it’s not good news for the legions of people worried about their jobs that cash-strapped companies are cutting back their severance packages. As many as 20 percent of firms say they now have plans to make changes to what they offer their former employees.

Jim Batson, an employment attorney and partner at Liddle & Robinson, LLP, advises clients to inform themselves about their company’s severance procedures. If you’re on the firing line and offered a severance, don’t just sign the papers and walk away, Baton says. Most corporations give employees time to review the documents at the point of termination. In many cases, you will have weeks to comb through the agreement to see if you believe you’re being adequately treated.

Batson recommends doing some investigative research to find out what others in your company or similar field received for severance and also to find out if the company has settled litigation with previous employees regarding their termination.

Getting a lawyer involved is a good idea, too, Batson says, but NOT necessarily to be used as leverage against the company. Instead, have your lawyer help you understand the terms of termination and what you’re being offered in terms of severance. Only consider having them call your former employer if you decide you are being dismissed or treated unfairly. Even if this is the case, it’s often a better idea, according to Batson, to go first to your manager or boss to discuss the severance terms. Then and only then, after you’ve done all your homework, should you ask for a counteroffer if you believe one is merited.

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