Should I Sign This Severance Agreement? A California Employee’s Guide 2026

If your employer offers you a severance agreement, it’s important to know what terms you’re signing off on should you accept it. These are legally binding agreements, and the terms might not be favorable for you. Like many employees who have been offered these deals, you’re probably wondering, “Should I sign this severance agreement?” The answer: not so fast. It’s important to have an attorney review the agreement before you sign it.

Understanding Severance Agreements

A severance agreement is a legally binding contract between an employee who is leaving their position and their employer, detailing the terms of their separation. Terms in severance agreements typically cover compensation, benefits, and outplacement services, as well as clauses such as non-disclosure and non-disparagement agreements. Unlike other states, California does not allow for non-compete agreements, which are otherwise common in severance agreements.

Most importantly, severance agreements often have clauses that prevent employees from filing claims against their employers. This is why it’s particularly important to work with an attorney before signing a severance agreement. You never want to give away your rights without fully understanding the weight of that decision.

Reasons Not to Sign a Severance Agreement

In California, 64% of workers say that they’ve never received severance pay when they lost a job. That’s an important figure to know because it highlights how uncommon severance agreements are. For that reason, many workers don’t know what issues to look out for when they’re offered severance. Reasons not to sign a severance agreement include:

• The agreement was presented under pressure.
• It offers no value beyond what you’re already owed.
• It contains broad or vague terms.
• You suspect wrongful termination, discrimination, harassment, or other illegal behaviors.

Remember that you often forfeit your right to file a claim against an employer when you sign a severance agreement. In 2024 alone, the Equal Employment Opportunity Commission received 88,531 new workplace discrimination charges. Signing a severance agreement would mean you couldn’t pursue compensation if you were the victim of such a violation. That’s why it’s important to contact a California severance attorney and have them review the document before you sign and return it.

Factors That Influence Severance

Many factors can influence the severance agreement your employer offers. Your employer will likely consider your length of service, job level, and the reason for termination. The longer you’ve been with the company and the higher-level the job you held, the better severance agreement you’re likely to get. Alternatively, you may have terms in your employment contract that mandate what type of severance agreement your employer will offer.

Call The Law Office of Briana Kim Before Signing a Severance Agreement

Before you sign a severance agreement, it’s essential to have an employment law attorney review the document. Your employer may be offering unfair or even illegal terms, all with the intention to limit your legal options going forward. That’s why you’ll want to work with the experienced team at The Law Office of Briana Kim. We know the state’s severance laws, and we’re dedicated to protecting employees’ rights when it comes to these termination agreements.

As a small firm, we can give each client the attention and support they need, but we also have the resources and technology to stand up to even California’s largest companies. We work with you to see that your severance agreement is fair, legal, and enforceable. If necessary, we’re prepared to negotiate with your employer in pursuit of a more favorable agreement. Briana Kim is recognized by Super Lawyers, and she knows how to hold employers accountable when they violate your rights.

FAQs

Should I Sign a Severance Agreement?

You should not sign a severance agreement without having a lawyer look at it first. It’s a legally binding contract, and you should be sure the terms are fair to you and legally enforceable. If you sign it and then later decide you don’t like the agreement, there’s no going back to make changes. What’s more, you likely waive your rights to file a claim against your employer when you sign.

What Are the Red Flags in a Severance Agreement?

Red flags in severance agreements include unreasonable non-compete clauses, overly broad confidentiality agreements, vague non-disparagement clauses, and compensation that is less than what you are currently owed. That last part is especially important, as many employers use these agreements to avoid paying workers the full amount they are owed. As for non-competes, keep in mind that they are illegal under California law and are, therefore, unenforceable.

What Happens If I Refuse to Sign a Severance Agreement?

Refusing to sign a severance agreement simply means that you won’t receive any of the benefits listed in the document. This means you’ll lose out on common benefits like severance pay, continued health insurance, and outplacement services. However, you do retain your right to file a claim against your employer, which is important if they wrongfully terminated you or broke other employment laws.

Do I Have to Sign a Severance Agreement Immediately?

No, under California law, you don’t have to sign a severance agreement immediately. SB 311, also known as the Silenced No More Act, gives employers at least five business days to review a severance agreement and return it to their employer without fear of the offer being rescinded. This gives you time to have an attorney look it over and negotiate terms if necessary. You do have the right to sign and return the document sooner than that five-day deadline.

Hire a Severance Lawyer

While most employers do not offer severance agreements, it’s important that you know what to do if your company extends one to you. Hire a severance lawyer to help you review the document, determine whether its terms are fair and enforceable. If necessary, your attorney can negotiate with your employer to secure a more favorable deal, working to protect your rights every step of the way.

Contact The Law Office of Briana Kim today to schedule a free consultation for your severance case. We can discuss your severance agreement, review its terms to decide if they’re fair, and construct a case-specific strategy to pursue the severance agreement you deserve.

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