Settling the Case and Wrapping Up Employment: Negotiating Strategies, Drafting Realities

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For the employee, even the high level executive, separation or settlement agreements are often the first
legal document that they have had to sign in regard to employment and often the first circumstance in
which they have needed to hire counsel outside of a closing or a divorce. Negotiating and drafting these
agreements can be a challenge for employee counsel. This is especially true for attorneys who
represent executives. With the amount of recent regulation in this area and the reluctance of
companies to commit to employment agreements and severance plans, it is increasingly more difficult
to protect the at‐will employee ahead of a downsizing or other termination event, leaving the employee
vulnerable when her employment ends.

Even when a contract of employment exists, there are other issues that may arise on account of the
settlement or separation that were unforeseen, such as new tax or other government regulations or
conditions on incentive compensation equity or new restrictive covenants.

Once the monetary package has been negotiated, issues of drafting become paramount and
understanding the underlying case and statutory laws that guide certain provisions including those
relevant to waivers and releases is key to achieving a balanced and equitable agreement for the client
and giving her the best chance at re‐employment.