Severance Package Review in Birmingham, MI: What You Are Really Being Asked to Sign

Your employer just handed you a severance agreement and a deadline. The payment looks fair. The pressure to sign is real. And somewhere in the back of your mind, a question is forming: should I have someone look at this first?

Yes. You should. Here is why that instinct matters.

A severance agreement is not a formality. It is a legal contract specifically designed to eliminate your right to take legal action against your employer. The payment is the price tag on that elimination. Severance agreements almost always include a broad release of legal claims covering discrimination, retaliation, wrongful termination, and wage violations. Signing ends those rights permanently.

Whether that trade is worth it depends entirely on what you are giving up, and most employees never find out until it is too late to do anything about it. The deadline your employer gave you is real, but in many cases it is negotiable. You almost certainly have more time and more options than you realize.

The Release of Claims Is What Your Employer Is Actually Buying

The severance payment gets your attention. The release of claims is what the employer cares about.

When you sign a severance agreement, you agree not to bring legal claims arising from your employment or termination. That release typically covers everything: discrimination based on race, sex, age, disability, religion, or national origin; retaliation for having reported harassment or exercised a protected right; wrongful termination; unpaid wages or overtime; and FMLA violations.

The scope matters. Some releases are narrowly written and reasonable. Others attempt to cover claims that have not yet arisen, claims the employee does not even know they have, and rights that cannot be legally waived at all. Michigan employees frequently sign broad releases without realizing that some of the provisions being waived are stronger than others, or that certain provisions may not be enforceable as written.

What Else Is Usually in the Agreement

Beyond the release, severance agreements commonly include terms that affect your life well after the check clears:

• Non-disparagement clauses restricting what you can say about the company, its leadership, or your departure, often including social media and conversations with future employers
• Confidentiality provisions preventing disclosure of the agreement's terms, sometimes so broadly written that you cannot tell a spouse what you received
• Non-compete clauses limiting where you can work, for how long, and in what capacity. Michigan courts will enforce reasonable non-competes, and what qualifies as reasonable is fact-specific
• Non-solicitation clauses barring contact with former clients or colleagues
• Repayment triggers requiring you to return the severance if the employer determines you violated any term, sometimes defined vaguely enough to create future exposure

None of these provisions exist to benefit you. They exist to protect the employer after you leave. Understanding them before you sign is the only way to know whether they are standard, overreaching, or worth pushing back on.

The Legal Protections You Have Before Signing

If You Are 40 or Older, Federal Law Gives You Specific Rights

This is the most consequential and least understood aspect of severance law for Michigan employees.

The Older Workers Benefit Protection Act requires that any waiver of age discrimination claims in a severance agreement meet specific standards: the agreement must be written in plain, understandable language; it must specifically name the Age Discrimination in Employment Act; and it must advise the employee in writing to consult an attorney before signing.

Beyond those requirements, the employee must be given at least 21 days to consider the agreement, and after signing, the employee has 7 days to revoke the agreement. That revocation right cannot be waived or shortened by the employer.

What this means practically: if you are 40 or older and your employer is pressuring you to sign before 21 days have passed, they are violating federal law. If an employer fails to meet any of the OWBPA requirements, the waiver of ADEA rights may be void, meaning the employee may still be able to file an age discrimination claim even after signing.

Many employees in Birmingham and across Oakland County sign agreements that do not fully comply with these requirements, without ever knowing it. An attorney can identify those deficiencies quickly, and they often represent significant leverage.

If You Are Under 40

Federal OWBPA protections do not apply, but Michigan law and the terms of the agreement itself still govern. You still have the right to consult an attorney. The employer's stated deadline is typically their preferred timeline, not a hard legal requirement in most cases. Review the agreement carefully and do not let artificial urgency drive the decision.

When the Offer on the Table Is Not the Final Offer

Most Birmingham employees assume severance agreements are take-it-or-leave-it. Employers design them to feel that way. The reality is more nuanced.

Employers offer severance because they want something: a clean legal release, confidentiality, a non-disparagement commitment, or a non-compete. Those things have value to them. That value creates room to negotiate, particularly when the circumstances of the separation involve potential legal claims.

What Creates Negotiating Leverage

The strongest lever in any severance negotiation is the existence of potential legal claims. If your termination involved conduct that could support a discrimination, retaliation, or FMLA claim, the employer's exposure does not disappear because they offered you severance. It sits on the table until you sign the release. That exposure is exactly what gives you the ability to ask for more.

Other factors that create leverage include long tenure, a senior or specialized role, a layoff that disproportionately affected employees in a protected class, or an employer who wants confidentiality provisions honored.

What Can Actually Be Negotiated

The payment amount is the most common target, but it is not the only one. Employees regularly negotiate:

• Additional weeks of severance pay, particularly when tenure or role warrants it
• Extended health benefit continuation beyond the initial offer
• Payment of outstanding bonuses or earned commissions the employer has not yet paid
• Removal or significant narrowing of non-compete clauses
• Neutral or positive reference language added to the agreement
• Clarification of vague repayment triggers that could create future liability

The negotiation process does not have to be confrontational. In most cases, it is conducted through counsel and focused on specific terms rather than a broad dispute about the separation itself.

What a Severance Review Looks at and Why It Matters

A review is not about making the process more complicated. It is about making sure you are not making a permanent decision based on an incomplete understanding of what you are agreeing to.

When an employment attorney reviews a severance agreement, the analysis covers the release language and whether it is broader than legally necessary, OWBPA compliance if age discrimination claims are being waived, the enforceability of any non-compete under Michigan law, the scope of confidentiality and non-disparagement provisions, repayment trigger language, and whether the payment amount reflects the realistic value of the claims being released.

That last point is where most employees benefit most. The question is not just whether the severance number sounds reasonable. It is whether that number adequately compensates for the specific legal rights being waived given the actual circumstances of the separation. A payment that looks fair in isolation may be significantly below what a legal claim would be worth, or it may be a genuinely good deal. The only way to know is to evaluate both sides of the trade.

Frequently Asked Questions

Does Michigan law require employers to offer severance?‍

No. Michigan is an at-will employment state. Employers are not legally required to offer severance unless a written contract, established company policy, or collective bargaining agreement requires it. When an employer offers severance voluntarily, they are doing so to obtain a legal release from you. That is why the terms of the release deserve the same scrutiny as the payment.

Can I negotiate after the employer says the offer is final?

‍In most cases, yes. Employers routinely say severance offers are non-negotiable as a negotiating tactic. Whether you have actual leverage depends on the facts of your separation, your tenure, and whether potential legal claims exist. An attorney can assess this quickly and advise whether pushing back is likely to be productive or not.

What happens if I do not sign the severance agreement?

‍You keep all of your legal rights. You do not receive the severance payment. Whether that is the right outcome depends on whether you have viable claims worth pursuing and what the payment being offered is actually worth relative to those claims. Some employees are better served declining and pursuing claims. Others are better served accepting a fair offer and moving on. There is no universal answer.

If I am over 40 and my employer pressured me to sign before 21 days, is the agreement still valid?

‍Potentially not for the waiver of age discrimination claims. OWBPA requires the full 21-day consideration period as a condition of a valid ADEA waiver. An employer who pressures an employee to sign early may not have obtained a legally enforceable release of age discrimination claims, even if the employee signed. This is worth examining with an attorney if it applies to your situation.

Should I sign the agreement and then consult a lawyer?

‍No. Once the agreement is signed and the 7-day revocation period passes (for employees over 40), the release is binding. Consulting an attorney after signing rarely changes the outcome. The review needs to happen before you sign, while you still have options.

Have Your Severance Agreement Reviewed Before You Sign

The decision you make about a severance agreement is one of the few employment decisions that cannot be undone. Getting a clear, informed assessment of what you are being asked to sign takes a fraction of the time you would spend second-guessing the decision afterward.

Batey Law Firm, PLLC represents employees across Birmingham, Oakland County, and Michigan in severance agreement reviews, wrongful termination, discrimination, and retaliation cases. Attorney Scott Batey has practiced exclusively in employment law since 1996 and has been recognized by Michigan Super Lawyers every year since 2014.

Schedule a free consultation before you sign anything.

248-540-6800 | sbatey@bateylaw.com

‍30200 Telegraph Rd., Suite 400 | Bingham Farms, MI 48025