Severance Agreement Checklist

Last updated: June 5, 2026. Reviewed quarterly. Verify any specific figure with an employment attorney before relying on it for a decision.

What this is

A checklist of things to look for in a severance agreement before you sign. Designed to be used alongside your actual document, on screen or printed.

This is not legal advice. This is a list of questions worth asking. For decisions specific to your situation, consult an employment attorney. Many will do a 30-minute severance review for a flat fee, often $300–$500.

For the regulations behind the items below, see our Reference Card.

Who this serves

The checklist below covers standard severance packages for full-time W-2 employees.

This checklist doesn’t cover:

• Executive severance with golden parachutes, change-of-control provisions, or Section 280G excise tax considerations
• Severance involving large equity packages with cliff vesting or malus and clawback clauses
• Severance from federal contractor positions with cleared status implications
• Severance during or after an acquisition where successor liability is at play

If any of these apply, the checklist won’t serve you well. Consult an employment attorney. The cost of that consultation is small compared to the value of the package you’re negotiating.

First, three quick triage questions

These determine which sections of the checklist apply to you most strongly.

1. Are you 40 years old or older?

If yes, the federal OWBPA gives you minimum review and revocation windows. See Section 4 below and the OWBPA entry on our Reference Card.

2. Were two or more workers 40+ laid off as part of the same decision, even if the layoffs were staggered over time?

If yes, OWBPA’s group-layoff provisions apply. The minimum review window is longer (45 days, not 21) and your employer must provide additional disclosures, including the job titles and ages of all employees the employer considered for the layoff and those it selected.

A staggered series of terminations over weeks or months can still count as a “group” if they were part of the same decisional unit (the same plan or RIF). You may not realize your individual layoff is part of a larger one. If you suspect it might be, ask the employer in writing whether the OWBPA group-layoff disclosures apply.

3. Are you on a work visa (H-1B, OPT, STEM OPT, L-1, O-1, TN, or E)?

If yes, the time pressure you’re facing is structural, not psychological. Don’t sign anything that compromises your ability to act on visa-related deadlines. Consult an immigration attorney alongside any employment attorney.

Section 1: Compensation

• Is the severance amount in writing and matches what was offered verbally?
• Is the payment schedule clear? (lump sum vs. salary continuation, dates, method)
• Are any earned but unpaid wages, commissions, or bonuses listed separately and paid regardless of whether you sign?
• Is PTO payout addressed? (state laws vary on whether unused PTO must be paid)
• If you have a bonus pending, does the agreement address pro-rated payment?
• Does the agreement include any clawback if you accept a competing role?

If you’re on salary continuation: the structure may affect when you can file for unemployment in some states. See salary continuation entry on the Reference Card.

If you’re on a visa: the lump-sum vs. salary-continuation choice affects your grace-period calculation differently. For specifics, see Appendix B of the mid-career layoff guide.

Section 2: Equity

• Is the vesting status of your equity clearly stated as of your last day?
• Does the agreement accelerate any vesting? (single-trigger or double-trigger acceleration)
• If you have unvested options, what is your exercise window after termination? (often 90 days, sometimes longer)
• Are any unvested RSUs forfeited, or is there partial accelerated vesting?
• If your company is private, does the agreement address what happens to your shares in a future acquisition?
• Are there any tax-withholding considerations for the equity portion that you should plan for? (A CPA, not an attorney, is the right consultation for this.)

For RSU and equity decisions specifically, the mid-career layoff guide and early-career edition have full sections on this.

Section 3: Healthcare and benefits

• Is COBRA coverage information included, including how long subsidized coverage (if any) lasts?
• Is any employer subsidy of COBRA listed in dollar amounts and duration?
• Is your last day of active health coverage clearly stated?
• Are any other benefits (401(k) employer match through a date, FSA, HSA) addressed?
• Is the deadline for COBRA election clearly stated?

For COBRA costs and ACA alternatives, see the COBRA/ACA entry on our Reference Card.

Section 4: Legal release language

This is the section that does the most for your employer and requires the closest reading.

• What claims are you releasing? (general release, age claims specifically, claims under specific statutes)
• Are you releasing only known claims, or also unknown claims?
• Does the release apply only to your former employer, or also to its parents, subsidiaries, officers, and affiliates?
• Are there carve-outs preserving your right to file charges with the EEOC, NLRB, or other agencies?
• Are there carve-outs preserving your right to apply for unemployment?
• Are there carve-outs preserving your vested retirement benefits?

If you’re 40 or older:

• Does the agreement clearly tell you to consult an attorney before signing?
• Is the consideration period at least 21 days for an individual layoff, or at least 45 days for a group layoff?
• Is there a 7-day revocation period after signing?
• If you’re in a group layoff, does the agreement include the OWBPA-required disclosure listing the job titles and ages of employees selected for separation and those not selected?

If any of these are missing, the release of age-discrimination claims may be unenforceable. This matters. See the OWBPA entry on our Reference Card.

Section 5: Restrictive covenants and non-disparagement

• Is there a non-compete clause? If yes, what is the scope, duration, and geography?
• Is there a non-solicit clause? (employees, customers, both?)
• Is there a non-disparagement clause? Is it one-sided (you can’t disparage them, but they can disparage you) or mutual?
• Is there a confidentiality clause covering the existence and terms of the agreement itself?
• Is there a cooperation clause requiring you to assist with future legal matters? Are you compensated for that time?

On non-competes: the FTC issued a rule in 2024 that would ban most non-competes; the legal status of that rule has been challenged. State law varies significantly. A non-compete that’s enforceable in Florida may not be enforceable in California. See the non-compete entry on our Reference Card.

On non-disparagement: recent NLRB rulings have limited the enforceability of overbroad non-disparagement clauses against non-supervisory employees. See the McLaren Macomb entry on our Reference Card.

Section 6: Other provisions

• Is there a “no admission of liability” clause? (standard, usually fine)
• Is there a choice-of-law provision? Does it specify a state different from where you worked?
• Is there a venue or arbitration clause requiring you to resolve disputes in a specific forum?
• Is there a class-action waiver?
• Are reference and rehire eligibility addressed?
• Is the return of company property and its timeline specified?

Before you sign

• Have you read the entire document, not just the summary?
• Do you understand every clause? If not, what’s unclear?
• Have you consulted an employment attorney? (Even a 30-minute review can catch things you’d miss.)
• Have you used your full review window, or are you signing early because of perceived pressure?
• Are there terms you want to negotiate before signing? (Severance amount, length of healthcare continuation, equity acceleration, non-compete scope, and reference language are all commonly negotiable.)
• Have you saved or printed an unsigned copy for your records?

Most workers do not negotiate severance agreements. That’s not because the agreements aren’t negotiable. It’s because most workers don’t know they can.

A polite, professional response asking for specific changes is a standard part of the process. Your employer expected the possibility. Whether they say yes depends on the company and your situation, but asking is rarely held against you in most professional settings (power dynamics can vary, and workers in vulnerable positions, including visa holders and recent hires, may want to weigh that carefully).

If you’ve already signed

• If you signed within the last 7 days and you’re 40+, you may still have time to revoke. Check the agreement’s revocation language. The right to revoke can’t be waived.
• If you discovered something after signing that the agreement didn’t disclose (a misrepresentation), consult an attorney about whether the agreement is enforceable.
• If you signed under duress (threats, coercion, an unreasonably short window), consult an attorney about whether the agreement is enforceable.
• Otherwise, signed agreements are generally binding. Focus forward.

This checklist points to the regulations and considerations worth knowing about. For decisions specific to your situation, consult an employment attorney. For more context on any item above, see our full layoff guide or reference card.

Last verified: June 5, 2026.