Michigan is an at-will employment state, meaning your employer can fire you for almost any reason—as long as it isn’t illegal. Because of this, many employees first see a severance agreement after they’ve already been terminated, laid off, or pressured to resign. These agreements often show up during moments of stress, confusion, and uncertainty. That’s exactly why employers use them.

A severance agreement isn’t simply a parting gift—it’s a legal tool designed to protect the employer, not you. Companies use severance packages to:

• Limit their liability for discrimination, retaliation, or wrongful termination
• Silence employees through confidentiality or non-disparagement provisions
• Avoid future lawsuits by requiring employees to waive their rights
• Secure broad releases that prevent you from pursuing claims you may not even know you have

In Bingham Farms and across Metro Detroit, employees from hospitals, automotive suppliers, manufacturers, financial institutions, universities, and corporate offices routinely face these agreements. Local employers have sophisticated legal teams—and you deserve the same level of protection.

For nearly three decades, Attorney Scott Batey has been a powerful advocate for Michigan workers. Known for his measured, results-oriented, no-nonsense approach , he ensures employees are not pressured into signing away their rights or accepting less than they deserve. When your livelihood is on the line, experience matters. And in Michigan, Batey Law is employment law.

What a Severance Agreement Really Is

A severance agreement is a contract between you and your employer that typically offers money or benefits in exchange for giving up certain rights—often including your right to sue. It is a legally binding document, and once you sign, the terms are extremely difficult to undo.

Most severance agreements include several common components:

Compensation or Lump-Sum Pay

This may look generous, but it’s often far less than the value of the claims you’re being asked to release.

Insurance Continuation or COBRA

Employers sometimes offer to extend health coverage temporarily—but this may come with conditions or gaps.

Confidentiality Clauses

These provisions restrict what you can say about your termination, the company, or the circumstances surrounding your exit.

Non-Disparagement Clauses

You may be prohibited from saying anything negative about the employer—while the employer may not be restricted at all unless negotiated.

Noncompete or Nonsolicitation Restrictions

These can limit your ability to work in your field, contact former colleagues, or build your career.

Release of Claims

This is the employer’s priority: a broad waiver of your right to bring claims under discrimination, harassment, retaliation, FMLA, ADA, or whistleblower laws.

When You Should Hire a Severance Agreement Lawyer

You were laid off, terminated, or “asked to resign.”

Severance agreements are often used to reduce the risk of claims arising from suspicious or sudden separations.

You suspect discrimination.

If your termination followed unfair treatment related to:

• Age
• Race
• Religion
• Disability
• Gender or LGBTQ+ status

…your severance agreement may be an attempt to preempt an ELCRA, ADA, or PWDCRA claim.

You made a complaint at work—then suddenly received a severance offer.

This is a classic retaliation red flag. If you reported harassment, safety issues, discrimination, or wage violations and were immediately offered severance, your employer may be trying to cut off a WPA, MIOSHA, or retaliation claim.

Your employer wants you to waive rights under major employment laws.

Most severance agreements attempt to waive claims under:

• ELCRA (Michigan’s civil rights law)
• ADA (disability accommodations)
• FMLA (protected medical or family leave)
• WPA (whistleblower protections)

Your severance package includes restrictive covenants you don’t understand.

Noncompetes, nonsolicits, confidentiality clauses, and non-disparagement terms may follow you long after you leave the company—and may be negotiable or unenforceable.

The offer seems low or unfair compared to coworkers.

You may have leverage your employer hasn’t disclosed—especially if they fear litigation.

What Michigan Law Says About Severance Agreements

Severance Isn’t Required Under Michigan’s At-Will Employment System

Michigan is an at-will state, which means employers are not obligated to offer severance pay when they terminate an employee. When they do offer it, it’s almost always to secure legal protections for themselves—usually in the form of a release of claims.

Releases Must Be “Knowing and Voluntary”

Under federal guidance from the EEOC, any waiver of discrimination claims must be knowing and voluntary, meaning you must fully understand what rights you are giving up before signing. This includes waivers involving race, age, sex, religion, disability, and other protected classifications.

Special Protections for Workers Age 40+ (OWBPA)

For employees aged 40 or older, the Older Workers Benefit Protection Act applies. A valid release of age discrimination claims must:

• Provide a 21-day review period
• Allow a 7-day revocation period after signing
• Use clear, understandable language
• Not waive future claims
• Offer something of value beyond what the employee already earned

Employees With Pending Discrimination or EEOC Complaints

If you have already filed an internal complaint, an HR grievance, or an EEOC charge, employers must follow strict rules about how and when they can request waivers. You cannot be forced to withdraw or waive the right to participate in an agency investigation.

Michigan Courts and Noncompete Agreements

Historically, Michigan courts have enforced noncompetes that are reasonable in duration, geographic scope, and business purpose. However, courts have rejected agreements whose sole purpose is to prevent competition rather than protect legitimate employer interests.

Recent federal regulatory changes (FTC rulemaking) show a growing national trend against enforcing noncompetes, especially for non-executive workers. While litigation over these changes continues, many Michigan severance agreements still contain outdated or overly broad restrictions—making seasoned review essential.

The Biggest Red Flags in Severance Agreements

Hidden Noncompete or Nonsolicitation Clauses

Employers sometimes insert restrictive covenants deep inside the agreement, limiting your ability to work in your field or contact colleagues—sometimes for years.

Overly Broad Confidentiality Clauses

Some agreements prohibit you from discussing illegal conduct you witnessed, including discrimination, harassment, or unsafe practices. These clauses can chill your rights under EEOC, MIOSHA, or whistleblower laws.

Signing Bonuses That Disappear if You Apply for Unemployment

This tactic can force employees to choose between a modest severance or unemployment benefits—often without understanding the long-term impact.

Language Waiving Unknown or Future Claims

Releases should only cover past issues. Waiving “unknown claims” or “future claims” may be unlawful and strips you of leverage.

“Take It or Leave It — Expires Today” Pressure

This is a major red flag. Federal law gives workers 40+ a guaranteed review window, and all employees deserve adequate time to seek legal counsel.

Releases Far Broader Than Necessary

Some agreements attempt to waive rights under civil rights laws without offering fair compensation. Employers may request waivers covering:

• ELCRA
• ADA / PWDCRA
• Title VII
• FMLA
• WPA (Whistleblower Protection Act)

How Batey Law Negotiates Stronger Severance Packages

Comprehensive Legal Review

We thoroughly analyze the agreement, identify hidden risk factors, and evaluate whether your employer is attempting to avoid liability.

Identify Leverage Points Based on Employment Law Violations

We assess whether your termination may involve violations of:

• ELCRA (race, religion, gender, age, disability)
• ADA / PWDCRA (failure to accommodate, disability discrimination)
• FMLA (interference or retaliation)
• Whistleblower Protection Act (retaliation after reporting unlawful conduct)

Determine Whether the Employer Fears Litigation Exposure

Employers often offer severance because they recognize the risk of a lawsuit. We calculate the true value of your potential claims and use that to push for a better outcome.

Monetize Claims to Increase the Payout

We evaluate:

• Back pay
• Front pay
• Lost benefits
• Emotional distress damages
• Liquidated or statutory damages (where applicable)

Improve Terms Beyond Money

A strong severance package should protect your future—not just your bank account. We negotiate for:

• Neutral or positive reference language
• Extended health insurance or COBRA contributions
• Outplacement or career transition services
• Removal or narrowing of restrictive covenants
• Mutual non-disparagement (not one-sided in favor of the employer)
• Protection for your reputation and employability

Take Control of Your Exit—Protect Your Future Today

When you’re facing a termination or a severance offer, you only get one chance to negotiate the terms that will protect your career, your finances, and your future. Employers draft severance agreements to shield themselves—not you. Before you sign away your rights, your claims, or your leverage, speak with the attorney Metro Detroit workers trust to level the playing field.

For nearly three decades, Batey Law Firm has stood up for Michigan employees who deserve fairness, dignity, and compensation that reflects the true value of their contributions. Attorney Scott Batey brings the strategic, results-driven advocacy needed to secure stronger severance packages and protect your long-term interests.

Contact Batey Law Firm, PLLC

Address:
30200 Telegraph Rd., Suite 400
Bingham Farms, MI 48025

Phone: 248-540-6800
Email: sbatey@bateylaw.com
Website: www.bateylaw.com