4 ms·

The main reason why severance is offered is to keep people from portraying the company in a bad light. If anti-disparagement clauses were made illegal, fewer co

• gherkin0 11y ago
  > The main reason why severance is offered is to keep people from portraying the company in a bad light. If anti-disparagement clauses were made illegal, fewer companies would offer severance. Then let's make anti-disparagement clauses illegal and severance packages mandatory. Companies afraid of bad press may then be motivated to be even more generous than they would have otherwise. Not only would they have to pay you enough to sign, they'd have to pay you enough to make you happy enough that you don't speak against them. They'd only have a carrot but no stick. Frankly, if a company doesn't want to be portrayed in a bad light, it should endeavor to avoid doing things worthy of disparagement.
  • hwstar 11y ago
    I agree 100% on your last sentence. As for making severance statutory in the US; that will be a uphill battle.
• greenyoda 11y ago
  "The main reason why severance is offered is to keep people from portraying the company in a bad light." Probably a more important reason for offering severance is to insure against former employees suing the company (for wrongful dismissal, discrimination, sexual harassment, etc.). Most severance agreements demand a "general release of liability" in return for the severance payment. (Of course, that doesn't shield the company from criminal liability if anything they did was actually illegal, e.g., wage theft.)
  • hwstar 11y ago
    Most companies these days force employees to sign binding arbitration clauses. When these are in place, the risk of being sued goes down dramatically. The general release of liability you mention is sometimes a one-way release. In that case the company retains the right to sue the employee. A word to the wise: Always have a severance agreement reviewed by an attorney before you sign it.