This section assumes you have received some severance agreement / documentation. If you did not, please review Terminated. Severance Please!.

A severance agreement, in most cases is designed to achieve a few goals for the company – confidentiality, non-disparagement, etc. At a more basic level, the company is really trying to bridge your gap in unemployment so there is no financial burden. They want you to find a new job quickly.

POWER NOTE: WHY ARE YOU BEING LET GO? THIS IS CRITICAL TO UNDERSTAND.
This will frame much of the negotiation and your power.


3 TYPES OF TERMINATION

Job Elimination, Down-sizing, job relocation, company just purchased, etc.  
In this scenario, the company, whether big or small, has determined your skills are not worth paying for any more. This may sound a bit harsh, but companies are designed to make money.  Companies would love to have loads of people, doing efficient work for little pay. They are removing you for financial reasons.   
 
Fired – performance or cause. They are blaming you for what they believe to be something you caused.

• Performance:  You are not meeting their requirements for the position.  Does the company have policies or rules in place for this issue? Did they follow them? If no, you have serious leverage and maybe even a legal claim.

• Cause: This is typically a more black and white issue. You crossed the line.  This could be a simple job requirement, company rule, ethical violation or worse. 

Both Job Elimination and Being Fired.
You believe what the company is stating as the cause is really the opposite or a combination of both types.  For instance, your “job is being eliminated” but you think it may be for performance. Or, they are “firing you for cause” but you believe they just need to cut costs. If you believe this to be the case, do a bit more research, if possible, to determine the cause.  It is important not to be emotional here. (i.e. s/he never liked me, my intelligence threatens my boss, etc.)


6 STEPS TO PREPARE FOR THE NEGOTIATION

Step 1: Review and evaluate the documents.  Some key things to note:
Get your paperwork together and read through it - company policies, offer/agreement letter.

• Anything which suggests an employment contract with severance or company severance plan.

• Any documents which changed your responsibilities and compensation.

Is there anything complex or you do not understand? If so, get advice or a lawyer to review.

• Does the paperwork reference the law. If so, get advice on the subject.

Does the paperwork restrict any of your rights, whether immediately, or in the future?  If you give up any rights, the company has a contractual obligation to provide something in return. In legal terms, there must be consideration on both sides of the table. But, it does not have to always be financial. (i.e. positive letter of reference). The more rights you give away, the better you should be compensated.

• Confidentiality Agreement:  Make this mutual

• Right to Sue:  Make the terms mutual

• Disparagement Agreement: Make this mutual

• Non-Compete Agreement

• Did the company promise anything which is not included? If so, make sure you get it.

POWER NOTE: THE NEGOTIATION IS NOT ABOUT WHAT YOU WANT, IT IS ABOUT WHAT YOU CAN GET. 
Sometimes these are the same, sometimes not.

Step 2: Research
What did others from your firm, industry, experience level receive based on roughly the same circumstances.  Talk with them. Get as much out of them as you can.  Don’t be surprised if they cannot say very much given confidentiality documents.  
 
Questions to ask former employees and when necessary, how to ask them creatively.
Remember you now need a job, do not alienate, brag, be negative or bitter. You may need this person later.
 

• “Given my situation, what do you think I could expect?”  (Given their limited and probably only personal experience they will most likely give you something very close to what they received.)

• “Who did you negotiate with? How were they to deal with?”

• “Did you push back? What was their reaction?”

• “Did they offer anything you didn’t expect?”(If they signed a confidentiality statement, they can not tell you what they received, but could tell you what they were offered. This is usually not be covered in the agreement.)

• “Who else should I call who could help?”

• “Anything other things come to mind?

Step 3: Assign the Severance Agreement Value
It is imperative you assign a value to the documents they want you to sign. How much are they worth? 

• Confidentiality: Are you less valuable to a new company since you cannot take some key information with you?

• Non-Compete: How long will it take you to get another job when you cannot work for firms who are most likely to hire you?

Step 4: Develop a list of "wants" you would really like to get - big and small.

• Weeks of pay: 1-2 weeks for every year is common. But it can vary with salary and position.

• Health Insurance: Get it. You can then give it back. Can your wife or domestic partner put you on their plan for almost nothing?  If so, have your company give health insurance, discuss its value and then give it back asking for the same value in something else, like an extra few weeks of pay.

• Home office furniture: Mention the hassle they will have in collecting it and how you will use it to find a job.

• Computer: It is probably a bit dated anyway.  If it goes in a closet anyway – who cares? You will need to find your next job.

• Prorated bonus. This is a tricky subject legally.  In most cases, prorated bonuses are not given.  But, commissions that should be paid, must be given. If in doubt, contact a lawyer.

• Heath club membership: The company might already have this paid up for all employees.

• Mobile Phone: Is it under contract? Then chances are they may pay a termination fee.

• Day care

• Recommendation letter

• A place to job search

• Outplacement services: training / resume writing

Step 5: Develop a Personal Mantra
This is your “go-to” phrase. No matter what is said, this reply can never be rejected, or countered.  Once you say it...shut up.  Make them feel uncomfortable. The first person to speak looses.  Here are some examples:

• "I want to remain whole."

• "We need to find a better solution."

• "I need to protect my family."

 
Step 6: Develop a list of items not included, which you can offer.
Since you are being let go, the company believes they have covered all angles. But, they are limited by vision and scope – they are not in your shoes.  List items they may have overlooked.

• Knowledge

• A relationship: internal, a key customer.

• Big project you have working that may leave them in a bind.

• Facts which could hurt an employee or the company – inappropriate inter-office relationships, business deals, etc.

MAKE THE PIE BIGGER!
Your company has offered you specific benefits in the agreement –let’s say items 1, 2 & 3.  In return, they want you to agree to certain agreements –items A, B & C.  In the case, the pie looks like this.

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Since this is their initial offer, you want something better.  First, try to get more benefits for their same offer.  Once you have exhausted this avenue, you may want to offer them more benefits in return.  So, how do we add more items to both sides of the pie.   How to make the companies pie bigger:

• If you find a new job, they can stop paying you severance.

• If you find a new job, they can stop paying your health insurance.

• You will be available for 5 hours per week for phone consultation during the severance period.

• Agree to take your severance pay over a period of time, so less cash flow drain on the company at one time.

• Most companies will assume you are going to share your knowledge to someone else during the transition. Unless, this is specifically written in the paperwork, this can be offered.

 
WHO TO NEGOTIATE WITH

If at all possible, you should negotiate with the person who has the power to negotiate.  This is the person who can make a decision without asking for approval.  They are more likely to give in to your requests.  But. the bigger the company, the harder it will be to negotiate with this person.  The company has intentionally erected barriers to prevent you from reaching this person. It offers them protection.

When you begin your negotiation, ask your main point of contact if they are "authorized to negotiate on the company's behalf.?  Most likely, they will creatively answer "no."  Simply ask who has the authority to negotiate and ask to speak with them.  They will probably say no to that request and state they are the main point of contact.  This tactic will most likely have a low success rate, but it is worth trying.  Don't push too hard as you will most likely need to keep dealing with this person. 


NEGOTIATION CONCEPTS & TACTICS

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Fear:  You and the company have it.  It really is the driver behind all offered and counter-offered.  But, the company believes you are most fearful.  After all, this is your life.  The HR Manager is only doing their job and really has minimal personal repercussions.  We need to balance the fear.  This is done by challenging the company’s position and assumptions. Simply ask…”Why?” something is the way it is.

Company Fears: 

• Not getting you to sign the docs. You know something damaging.  Not getting your transition information.  You will not comply with the HR managers (not the company) request. (It would make them look very bad – not being able to do their job.)

• You will sue them. “I am disappointed (John/Jill). It appears you have left me no other option and my legal counsel assures me we have a good case. I really was hoping to avoid that avenue."

• They think you know something damaging and will use it in the press, lawsuit, blog, etc. “I am surprised my knowledge about (be vague) is not viewed as business critical.”

 

Your Fears

• The unknown.

• Not getting an agreement.

• Having the agreement removed.

       
Bluffing: Do not do it unless you are fully prepared to have it called and go down that road.  The only advisable time to attempt this tactic is if you have nothing to lose. In this case, the bluff must be realistic and targeted. You must clearly identify your company’s biggest fear and attack it.  If there is a company policy on severance and they are offering you the minimum and you believe this cannot be rescinded, a soft bluff may work, But, if your firm offered you something additional, or it is not required by policy, a bluff is most likely unadvisable. It is the fastest way to have the offer removed.

Silence: It signifies confidence and control.  People are compelled to talk. People do not like giving bad news.  People want to make thing better. People want to be liked.  Silence will bring these feelings out of your adversary. 

POWER NOTE: Silence is power!

Be Serious: There is no place for humor.  This is your life and it is not a joke.  Laughter and smiling is used as a stress reliever.  Resist the urge.  If they use, call them on it.  "Is this funny to you?"
       
Blame: Do not blame anyone or anything, including yourself. It will only stiffen your adversaries resolve.

Don’t argue: This is not negotiating, nor productive. It just aggravates everybody.

Know Your Adversary: What do you know about your negotiator?  Do they value their faith, family, etc.  Play those cards.  Try and put them in your shoes.  

• "How would your spouse react with an offer like this – would s/he think it is fair?"

• "Do you think this offer represents how you value others? Do you believe this offer is representative of your values and beliefs?" Most people will respond it is “the company, not me.”   You can respond in a number of ways, try  “But you are the company. You work for them. You are presenting this information. Why are you presenting something you do not support?  I really thought better of you.  Help me be treated fairly.”

The Counter Offer and its Inherent Rules
Although there are many negotiation techniques and styles, there are some constraints to the process.  
>Agreement: You will reach an agreement, whether you like it or not, even if the agreement is not to agree and you get nothing. 
>Time: The timeline is limited.  The back-and-forth can only survive a few rounds.  Over this and frustration will set in and possibly decrease your power and success.

Counter Verbally
Once you have a written severance offer, it most likely has a “must respond by” date.  In this case, you must get back to your company prior to that date, or the offer is automatically rescinded.   Although legally debatable, a company cannot withdraw an offer if a “respond by” date is included. But, if you counter in written form, you are formally rejecting their offer.  There is no reason to do this.  Conduct the counter-offer verbally (phone is best) with the person who signed the letter.  Before you pick-up the phone, make sure your list of “wants,” including pie-expanders is complete. 

The Ultimate Counter: The highest possible request without them immediately shutting you down and stopping the dialogue.  This is the point at which they are willing to continue talking.  Any response different than shutting you down is a solid position – they are willing to negotiate. 

TACTICAL APPROACH TO THE COUNTER

1. Thank them for the offer.  (They didn’t have to give you one.)

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2. Express disappointment and frustration.  (Doesn't matter what they give you - be unsatisfied!)

3. Let them know you are willing to work with them for an easy and positive transition from the company.  This will put them at ease.  
 
4. Light and reasonable issues. We recommend dealing with any paperwork issues, for example, language in the confidentiality agreement.  They will most likely agree think this is going to be easy.

• Would you mind…”changing this word to that.”

• Would you mind…”making section x mutual?”

 
5. Big issues. Put your biggest “ask” first. Then run down the list.  Get it out quickly and do not let them interrupt.   It is recommended you share this all at one time.  Share some of the rationale in having them revise the offer. You can also appeal to their human and emotional side.  ·        

• “I was a disappointed….”

• “I was a bit surprised the offer only (or did not) include…”

• “I would like to take a more serious look at…”

• "I am sure you would agree that…"

• "If you were in my shoes, I am sure you would think this to be a reasonable request."

6. Get off the phone – nicely and quickly. Most employers do not expect you to counter. They will not be prepared for it.  They will most likely not be able to give answers. Do not force it.  In fact, do not request, or expect an immediate response.  In fact, try to get your “wants” out and get off the phone nicely.  Say how much you enjoyed working at the company, wish them the best and hope they can work with you to ENTER MANTRA STATEMENT. (see above.)  Ask when you can expect to hear back.
 
THE FOLLOW-UP
If your contact asks for a list of your “wants.” It is ok to send it, but do not do so in a formal matter.   Keep it light and non-committal.  Do not reject the offer, merely provide a list.

• “Per our phone conversation, I will require the following items.”

They are Inflexible
What happens if they are not flexible.  Maybe they have their own “we are not negotiating, the offer is final, etc.”  Ask why? Push them to explain.  Make them talk – write it down!

• “Are you saying everyone who is terminated, gets the same package – CEO on down?”

• “Is this company policy? If yes, may I see it as a current employee. If no, then I am sure there is flexibility on the firms part.”  

• “I am doing my best to offer a smooth and positive transition.  I would rather not be adversarial.  My requests are not unreasonable.”

• Talk about your family and the financial hardship you are facing – be specific and be gut-wrenching.  

• “Please help me get to my next job in one piece.”

• "My family lives within its means, those created by this firm.  It will take me some time to get this back.

• "Given your offer, I don't think I will be able to sign your required paperwork."

• "It appears you are leaving me little option and I will need to contact a lawyer. I would rather not take that approach and bring the lawyers in.  That costs both sides money. Can we try and not go through that expensive hassle?"

 
TERMINATED FOR CAUSE, A DIFFERENT APPROACH
If you have been terminated for cause, obviously, you have less power.  Besides the 5 Unbreakable Power Rules, you need to be humble.  If you were clearly and understandably terminated for cause, you will probably be embarrassed.  Although it is rarely a good idea to admit fault, it is never too late to show your human side and admit that you may have miss-stepped and possibly made a mistake.  You are human, and do make mistakes.  
  
Additionally, whatever your mistake, you will need to turn this around and go find another job.  Your company has probably ignored this concept.  They just want you out, and quickly. 
 
In this case, one technique would be to evoke a sympathy response from the company.  If they have been good to you, say it.  Communicate this will put a heavy financial burden on your family.  There is no question you have and will continue to learn from this experience.  But, you need to find a job. Ask for help. 

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