Severance Agreements 101

Severance pay, review periods, revocation, unemployment, and continued health coverage.

Is My Employer Required to Pay Severance?

Severance obligations in New York arise from applicable employment agreements, employer policies, or other legal obligations. A standard termination alone generally creates no statutory severance obligation. Review those obligations alongside earned compensation and benefits owed at separation.

How Much Time Do I Have to Review an Agreement?

The deadline depends on the agreement and the rights being waived. For a qualifying waiver of federal age-discrimination claims by an employee age 40 or older, federal rules generally require at least 21 days to consider an individual offer, or 45 days for certain group termination programs. Review the specific offer and required disclosures to establish the deadlines that apply to your agreement.

Can I Change My Mind After Signing?

A qualifying federal age-discrimination waiver for an employee age 40 or older must provide a seven-day revocation period after signing. For other agreements, revocation rights depend on the terms and applicable law. Check the revocation period and notice procedure for your agreement.

Will Severance Affect Unemployment Benefits?

Severance or dismissal pay may affect unemployment eligibility in New York. Eligibility depends on the payment amount, timing, and structure, including lump-sum and installment payments. Confirm how your payment affects the start of benefits.

What Happens to My Health Insurance?

Eligibility for continuation coverage through COBRA or New York continuation rules depends on the plan and employer. Review election deadlines, premiums, and whether continued coverage or an employer contribution is part of the package. Check your actual coverage-end date and plan notices promptly.