Employment Separation Agreement FAQ

A separation agreement is a contract between an employer and a departing employee that defines the terms of separation. It typically includes severance pay, benefits continuation, release of claims, confidentiality obligations, non-disparagement provisions, and references.

In the US, severance is generally not required by law (except under the WARN Act for mass layoffs). Severance is typically offered in exchange for the employee signing a release of claims. Common amounts range from 1-2 weeks per year of service.

A release is the employee agreement not to sue the employer for claims arising from employment or termination. It typically covers discrimination, wrongful termination, wage claims, and other employment-related claims. The release is the primary reason employers offer severance.