Your employer laid you off, and now there’s a severance agreement waiting on your signature. It’s normal to feel overwhelmed. But that document you’re holding? It’s not your only option. You can negotiate severance pay or walk away with better terms.
A severance agreement isn’t a gift. It’s a contract. And contracts can be negotiated, especially if they contain terms that impact your money, benefits, reputation, or rights. In other words, you can learn how to negotiate a severance package without putting your dignity or your legal standing on the line.
At Smithey Law Group, LLC, we help employees across Maryland make informed, strategic decisions at moments like this. If your employer asked you to sign a severance package or you suspect a layoff is coming, we’ll show you what’s fair, what’s possible, and how to protect your future.
What Is a Severance Package?
A severance package is the bundle of pay and benefits an employer offers when ending your employment. In Maryland, the law doesn’t require employers to provide severance unless a contract or policy promises it. But once an employer offers it, you have a right to review the terms.
Typical packages may include:
- A lump-sum payment or continuation of salary,
- Payment for unused vacation or PTO,
- Continued health insurance (via COBRA or employer-sponsored extension),
- Retirement contributions or stock option vesting,
- A waiver of claims (your agreement not to sue),
- Non-disparagement or confidentiality clauses, and
- Restrictive covenants like non-competes or non-solicits.
Each of these items carries long-term consequences and potential leverage. The moment your employer offers you a package, negotiating the severance package terms becomes critical.
Is Severance Pay Negotiable?
Many employees assume their employer’s first offer is final. It isn’t. The question, “Is severance pay negotiable?” comes up in almost every consultation. And the answer is yes, especially when the agreement requires you to relinquish legal rights. Employers often rely on the assumption that people will accept what’s handed to them without question. However, once you recognize the document as a contract rather than a favor, the conversation changes.
Negotiations don’t have to be confrontational. Workers who approach severance discussions with strategy and thoughtfulness often secure better financial terms, extended health coverage, and changes to restrictive covenants. Even when a company claims its policy is standard, Maryland attorneys regularly identify leverage points the employee didn’t know they had. And because employers want closure, they are often willing to revise terms rather than risk conflict or litigation.
What Can I Ask for When Negotiating Severance Package Terms?
Severance isn’t one-size-fits-all. Depending on your role, tenure, compensation, and the nature of your termination, you may be able to negotiate for a more favorable outcome. You can request:
- Increased severance pay, especially if you’re giving up significant legal rights;
- Extension of healthcare coverage beyond the standard COBRA timeline;
- Payout for all accrued time off, including sick leave;
- Favorable language around references or employment status (e.g., voluntary resignation vs. termination);
- Narrowed or removed restrictive covenants, such as overly broad non-competes;
- Removal of broad non-disparagement clauses, especially if they silence you unfairly; and
- Outplacement support, including resume help or job search services.
Not every employer will grant all requests. But many will negotiate, especially when facing the risk of litigation.
Can I Negotiate Severance If I Was Laid Off Without Warning?
This question comes up in nearly every economic downturn: “Can I negotiate severance when my employer claims it had no choice but to eliminate my role?” The answer? Even during a reduction-in-force, you can still request revisions.
In some cases, employers implement layoffs without fully complying with federal or state requirements, which creates additional leverage. If the termination involves multiple employees, the Older Workers Benefit Protection Act (OWBPA) may require disclosures about the affected age groups and positions. That alone can open the door to negotiation. And if the employer never provided proper timelines or pressured you to sign too quickly, you may have the right to revoke the agreement or demand changes before signing. Sudden layoffs do not erase legal obligations or your ability to seek fair terms.
How to Negotiate Severance Pay with Leverage
Learning how to negotiate severance pay begins with understanding your value and the risks the employer wants to avoid. Documentation of strong performance, years of institutional knowledge, or even informal practices in your department can serve as leverage. If you experienced discrimination, retaliation, or were terminated after reporting misconduct, your negotiating power increases significantly.
Consider focusing on specific categories when seeking changes. For example:
- Compensation that reflects years of service or the value of claims being waived;
- Extended health or COBRA coverage to bridge the gap until new employment;
- Mutual non-disparagement provisions rather than one-sided clauses;
- Accurate language regarding the reason for separation, especially when future employers may ask; and
- Narrowed confidentiality terms that do not silence you beyond what is reasonable.
A structured approach, grounded in facts and framed as a reasonable adjustment, often yields better results than an emotional reaction. Maryland employers are used to negotiation; what matters is how the strategy is executed.
How to Negotiate Severance Package Terms Without Burning Bridges
It’s possible to negotiate severance package terms with professionalism and strength. And it helps to keep these guidelines in mind:
- Stay calm and professional. Emotion is valid, but a businesslike tone gets results.
- Don’t accept verbal promises. Get everything in writing.
- Frame requests around fairness. Position your asks in terms of equity and precedent.
- Focus on mutual benefit. Language like “this would help me move on cleanly” goes a long way.
- Avoid ultimatums. Unless advised by counsel, keep the door open.
- Involve an attorney early. Even if you don’t want them to negotiate for you, a review can help shape your strategy.
Maryland employers expect some level of pushback. Done right, your requests show that you understand your rights and value your contributions.
How to Negotiate a Severance Package: Maryland-Specific Considerations
If you’re a Maryland employee, state law may influence your leverage points. For example:
- Maryland recognizes certain implied contracts. Even if not written, implied terms can be valid in Maryland if your employer has a consistent severance practice.
- The state enforces restrictive covenants narrowly. Overbroad non-competes included in a severance agreement may be unenforceable.
- Older employees have specific rights. Under federal law, employees over 40 must receive clear OWBPA-compliant language and complete transparency during group layoffs.
These rules can work in your favor, especially when you understand what to look for. And if your termination involved discrimination, retaliation, or a violation of public policy, your ability to negotiate improves significantly. Why? Because the employer is asking you to waive serious legal claims that may be worth far more than what it is initially offering. Knowing how to use that leverage is key to securing a stronger severance agreement.
Common Mistakes to Avoid When Negotiating Severance Package Terms
Even savvy professionals make missteps during these conversations. Steer clear of the following:
- Signing documents under pressure, without full review;
- Focusing only on money while ignoring future restrictions;
- Failing to ask questions (many employers expect negotiation but won’t offer more unless prompted);
- Believing “standard” means “non-negotiable,” which is rarely true; and
- Assuming a lawyer will make things worse.
If you’ve already signed, you may still be able to revoke or challenge parts of the agreement, especially if legal defects or coercion are involved. It’s not too late to ask.
What If My Employer Offers Me Severance After a Dispute?
Sometimes, employers offer severance after a termination that has already become contentious. In these cases, negotiating severance package terms becomes even more critical. Why? Because the employer is likely trying to limit exposure. And if they’re asking for a release of claims, that release has value. You don’t give that away without getting something substantial in return.
This is where legal strategy meets negotiation. You may be entitled to:
- Higher compensation in exchange for waiving claims,
- Narrower releases that don’t cover future claims,
- A clean employment record, and
- Confidentiality terms that don’t prevent you from speaking to regulators or future employers.
In short, a severance agreement offered after a dispute raises the stakes. Don’t treat it as routine. Treat it as an opportunity to advocate for a better outcome with the law firmly on your side.
FAQs About Severance Negotiation in Maryland
What If My Employer Says the Offer Is Non-Negotiable?
That statement is often strategic, not factual. Employers may hope you accept quickly, but the law does not prohibit you from asking for clarification or changes.
How Do I Know If the Agreement Is Fair?
Fairness depends on context: your role, tenure, performance history, and potential claims. An attorney can evaluate whether the terms reflect the rights you are waiving and identify areas worth challenging.
What If I Already Signed the Agreement?
You may still have options. Under federal law, employees over 40 typically have seven days to revoke a signed agreement. If fraud, coercion, or legal defects are involved, additional challenges may be possible.
Can Negotiation Protect My Future Career?
Yes. Severance agreements often include provisions regarding references, resignation, and confidentiality. Securing accurate and neutral language can help protect your reputation long after the payment ends.
When Negotiation Requires Legal Backup
In some situations, the stakes warrant representation from the start. Executives, long-term employees, and individuals with potential legal claims benefit most from strategic guidance. Attorneys can raise concerns without creating hostility, rework restrictive covenants that threaten future employment opportunities, and accurately calculate the true value of a waiver. They also understand what Maryland employers typically agree to, which helps frame each request effectively.
Smithey Law Group LLC has built its reputation on handling these moments with precision and backbone. Founding attorney Joyce Smithey—a published authority in employment and labor law—has shaped the conversation statewide through her teaching, writing, and leadership in the Maryland State Bar Association. Her colleagues serve on the Labor and Employment Section Council and the Board of Governors, appear in national media outlets, and consistently earn recognition from organizations such as Chambers USA, Super Lawyers, and Lawdragon.
Employees do not have to navigate these negotiations alone. When your income, benefits, and future opportunities depend on the agreement in front of you, the right legal strategy can turn a take-it-or-leave-it document into a fair and workable deal.
Smithey Law Group, LLC Can Help
At Smithey Law Group, we help employees across Maryland craft strategies, uncover leverage, and negotiate on equal footing with corporate counsel. Our attorneys are nationally recognized leaders in employment law and have been quoted by The Washington Post, featured on MSNBC, and ranked by Chambers USA and Lawdragon for a reason. When your career’s on the line, you want a team that’s been here before. Don’t sign away your rights or leave money on the table. Contact us to understand the implications of your severance agreement and explore potential opportunities to improve it.
