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Severance Agreement Review — Know Your Rights Before You Sign

Severance agreements ask you to give up legal rights — including the right to sue — in exchange for a payment. Once signed, those rights are gone. Revealr's severance agreement review flags release of claims language, non-disparagement restrictions, non-compete extensions, garden leave provisions, and ADEA/OWBPA waiver requirements so you know exactly what you're trading away before you sign.

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What Severance Agreements Require You to Give Up

What Revealr checks in your severance agreement

Release of claims scope

What legal claims you are waiving and how broadly the release is written

Non-disparagement clause

Restrictions on what you can say about the company after leaving

ADEA waiver compliance

21-day review period and 7-day revocation rights for employees over 40

Non-compete extension terms

Whether the severance extends or adds non-compete restrictions

Confidentiality obligations

Post-employment confidentiality and trade secret obligations

Clawback conditions

Events that could require you to return severance payments

ADEA Waiver Requirements and the 21-Day Rule

Here is what a Revealr analysis looks like for a real Severance Agreement.

Revealr Analysis

Severance Agreement

Risk Score

74 / 100

CRITICAL§3.1

Broad Release of All Employment Claims

This release waives all claims arising from your employment including discrimination, wrongful termination, wage claims, and FMLA violations. Once signed, you cannot pursue any of these claims in court. Review the scope carefully before signing.

WARNING§7.2

Non-Compete Extended Through Severance Period

The non-compete restriction in your original employment agreement is extended for the full duration of the severance payment period. This may limit your ability to work in your field during the severance window.

→ Negotiate removal of the non-compete extension or request a carve-out for roles that do not directly compete.

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How to Negotiate a Severance Package

Employees being laid off

You have received a severance offer and want to understand what you are signing before the deadline

Workers over 40

You need to understand ADEA/OWBPA waiver requirements specific to older workers

Employees with potential claims

You want to know what legal rights you are giving up in exchange for severance pay

Most employees sign severance agreements within 48 hours of receiving them — without reading the release of claims clause. A properly reviewed severance agreement could be negotiated for more pay, fewer restrictions, or a narrower release.

Frequently Asked Questions

Yes. Severance is negotiable more often than employees realize. Common negotiation points include the payment amount, the duration of benefits continuation, removal or narrowing of non-compete extensions, and the scope of the release of claims. The strongest leverage is the 21-day review period — use it.

A release of claims is a legal waiver where you agree not to sue the company for any employment-related claims in exchange for severance pay. The scope matters significantly — broad releases cover discrimination, wrongful termination, wage claims, and more.

Under the Older Workers Benefit Protection Act (OWBPA), employees over 40 must be given at least 21 days to consider a severance agreement that waives ADEA age discrimination claims, and 7 days to revoke after signing. An agreement that does not meet these requirements may be unenforceable as to ADEA claims.

You keep all your legal rights but forfeit the severance payment. Whether that tradeoff makes sense depends on the strength of any potential claims and the value of the severance offered.

Related tools & guides

Employment Contract Review Termination Clause Review Non-Compete Agreement Review What to Check in an Employment Contract

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