Severance packages are a delicate aspect of employment. A highly placed employee or executive in Texas has some leverage to negotiate over the severance offer, which can change the value of the package by a large amount. It is an economic as well as legal concern, and much will depend on the circumstances.
Key factors in severances
A severance package can have many components, all of which are potentially open to negotiation. The length of severance pay is first and foremost because it is a large cash flow. The size and length can be negotiated.
Likewise, other aspects of compensation, like PTO, the cost of COBRA coverage for medical insurance and stock options for immediate vesting or cashless exercising are all on the table. The company may offer the services of a placement agency to help find a new job, or the employee may prefer money toward the cost of such an agency.
Conditions of the severance package
The employee will also have obligations under the package, like agreeing to release any and all potential claims against the employer. The company can also ask for a non-disparagement term, and the employee can ask that it be mutual. The company can also try to impose non-compete and non-solicitation clauses. Other parts of the package may cover things like the burden of legal fees, protecting company data, confidentiality or other employment law issues.
A severance package can include many pieces, and all of them can potentially be negotiated. This is not just for money but to set the employee up for a better next job and protect them from any legal fallout from the event that led to the termination of their job contract.