A friend called recently and asked if I’d written anything about negotiating the best possible deal with your employer when you lose your job. A friend of hers feared she was about to be laid off and didn’t know if there was anything she could do to protect herself.
Getting prepared is a good idea, say career coaches and lawyers who advise workers on how to handle a termination. The emotional shock of a layoff can be devastating, so it’s helpful to try to make a game plan in advance.
Mass layoffs are no longer dominating the news, though struggling companies are still axing large numbers of workers, like Yahoo’s recent announcement that it would cut 2,000 employees. Meantime, say coaches, other employers are trimming their rosters, though the firings tend to come one or a few at a time.
Coaches say that workers who lose their jobs as part of group layoffs have a tougher time negotiating a better severance package. But it’s worth trying, especially if you’ve logged a number of years at your company and formed strong relationships.
The two most important pieces of advice offered by employment professionals: Take some time to digest your company’s severance offer, and do negotiate for a better deal before you sign anything.
Employment lawyer Wendi Lazar, a partner at Outten & Goulden, notes that companies routinely ask departing workers to sign a document that waives almost all rights to sue under any federal discrimination statutes and state or local laws. At the same time, your employer might present you with an onerous non-compete agreement. Lazar says it’s wise not to sign before you consult with a professional, be it a lawyer or a coach, especially when it comes to non-competes. Those agreements deserve a separate article, but suffice it to say that the law requires employers to offer quite a bit of severance if they expect workers not to compete for an extended period.
Under the federal age discrimination law, Lazar adds, workers who are over 40 have the right to take 21 days to review a severance agreement. Lazar says this 21-day period has become routine in most companies for workers of all ages.
As for negotiating, coaches encourage you to ask for as much as you can get, starting with a larger severance payout. One job search professional, who doesn’t want to be quoted, emphasizes that most employers feel terribly guilty when they let a longtime worker go. “You play on their guilt,” he advises. “That’s how this game works.” This longtime job pro has seen departing workers double their severance, from four months to eight, and negotiate perks like keeping a company computer and BlackBerry, continued use of the office and payment for job coaching.
New York career coach Sarah Stamboulie, who worked in human resources at Morgan Stanley, Nortel Networks and Cantor Fitzgerald before becoming a coach, agrees that it can be effective to make a personal plea for more money. “It could even be something that’s not related to business, like, ‘We just bought a house, and I can’t believe you’re planning to lay me off.’” Stamboulie adds that while severance surveys show the majority of companies offer a standard one to two weeks’ pay per year worked, “there is no real standard.” Most companies have a number in mind, she says, but many of her clients have talked their way to greater sums.
Employers don’t want to be sued, and coaches advise against filing suit unless you have a serious claim and you’re ready to accept that future employers might be leery of a worker they perceive as litigious, but you might find it useful to hold off on signing the legal waiver while remaining pleasant and genial in negotiations.
If you are coping with health problems in your family, do let your employer know and ask for extended health benefits. Last year one of Stamboulie’s clients, who worked in financial services, got laid off just as his wife was starting breast cancer treatment. He persuaded his firm to extend his health insurance for six months before the COBRA clock started ticking.
New York career coach Connie Thenasoulis-Cerrachio, who previously worked in human resources for Citigroup, Pfizer and Merrill Lynch, says if you’re working on a long-term project or you see a particular need in your department, it’s worth it to offer to complete your assignment and to take on another task. A colleague of hers was about to be let go but wound up filling in for someone more senior who was heading out on maternity leave. He proved himself so valuable that he wound up getting promoted twice.
One more thing to negotiate: your exit message. Think beyond the idea of implying that it was your choice to leave, because that can sound fishy if there’s not a story behind it. Stamboulie had a client who was laid off from a hedge fund research post. He and his bosses agreed that one of the managing partners would say that although the researcher was terrific, the partner determined there wasn’t room for advancement at the small firm. This way the partners could give Stamboulie’s client strong references and the best hope for landing another job.
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