Author Topic: Talk to me about severance: Can I negotiate during site closure?  (Read 2992 times)

homestead neohio

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This is my first time being laid off after 16 years in my industry across 3 different corps, so I've never negotiated severance.  Was planning to stick it out in my current job until FIRE, MegaCorp had other plans.  Timing is fine, I'm cool with it, just want to get all I can out of this opportunity.

Relevant details:
I've always been considered a strong performer and taken on additional responsibility in individual contributor roles.  Technical SME, not supervisor/manager.  I have direct experience with core products that will be transferred to other sites.

I was offered a relocation job that was not attractive to me, so I declined and will be offered severance and retention bonus, last day of work end of Dec 2017.  I'll be one of the last people on site, many depart in June or Sept.  I'm waiting for official docs to confirm verbal dollar amounts, I have signed nothing at this time.

My questions:
Can I negotiate my severance or retention bonus up?  I've read articles that say yes, but how does this work in practice?  Make rational arguments or pull on heartstrings?  I made a list of reasons why my product and process specific knowledge is essential to transferring products to other sites, just don't know if they'd agree or care.  I think my chances are better than some colleagues based on getting a relo offer where most did not and having a Dec date, but don't know if this is a false hope.  What are people's experiences when involved in site closures?

ekimatuan

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Re: Talk to me about severance: Can I negotiate during site closure?
« Reply #1 on: October 27, 2016, 09:03:28 AM »
I've been through a number of layoff events over the years, only bit by one though when they closed down an entire location. I think it *might* be possible to do some negotiation but I've never seen it work.

What I have seen however is that people who are "critical" and kept on after most other people have been let go have often been able to get their next job, and begin working at it while still on the payroll at the old company and before the severance is granted out.

In one example, a coworker was kept on for 3 months after almost all others were let go. He got his next job (with a new company on the floor above his previous job) and worked their for those 3 months, getting two paychecks. His job at the old company for those 3 months was to support the existing system and answer questions of which there were very few. He also got severance totaling something like 4 months pay.

plog

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Re: Talk to me about severance: Can I negotiate during site closure?
« Reply #2 on: October 27, 2016, 09:05:04 AM »
1 word---Leverage:  Do you have any?

I'm your employer, HR created a formula to determine severance and we offered that to you, just like everyone else.   Why would I give you more money?  What's in it for me?  Why are you special? 

If you can answer those questions, that's your leverage and you may have a case.  If not, then you won't get anything more.

frugaliknowit

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Re: Talk to me about severance: Can I negotiate during site closure?
« Reply #3 on: October 27, 2016, 11:20:59 AM »
Do you know how much the retention bonus is?  Maybe you could trade some of that for a better severance package...?

homestead neohio

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Re: Talk to me about severance: Can I negotiate during site closure?
« Reply #4 on: October 27, 2016, 12:14:40 PM »
Do you know how much the retention bonus is?  Maybe you could trade some of that for a better severance package...?

I've been verbally quoted a number for both severance and retention.  Docs are in-process, held up because they first wanted to know my answer on the relo job offer, I expect they will confirm the verbal.  I only get this if I stay through my date, both amounts are all or nothing.  AFAIK, based on timing there will be no difference in how the severance and bonus are treated.  They both hit in January 2018, which is how I prefer it for tax reasons, just lucky.  I would be looking to increase the total amount and I don't care which number goes up, but moving from one bucket to the other is not the goal.  I expect the severance figure might be less flexible as it is set by a change of control agreement, but the retention bonus may be similarly calculated and an exception may require the same scrutiny/approval by HR/Finance people, all invisible to me.  I don't know who the decision makers are, just to whom I'd make my case (local HR Rep).  If severance is extended, there is a longer timeframe of being out of work before unemployment would kick in.  If retention bonus is increased, this timeframe remains unchanged. Unemployment is a small amount and may not be needed, so not a major consideration.

@ekimatuan, great story about collecting 2 paychecks plus severance.  I don't know if staying will become a cake walk like in that story or if I'll get saddled with a bunch of work I've never had to do before, but there is no one left to do it.  Part of the gamble.

homestead neohio

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Re: Talk to me about severance: Can I negotiate during site closure?
« Reply #5 on: October 27, 2016, 12:15:00 PM »

1 word---Leverage:  Do you have any?

I'm your employer, HR created a formula to determine severance and we offered that to you, just like everyone else.   Why would I give you more money?  What's in it for me?  Why are you special? 

If you can answer those questions, that's your leverage and you may have a case.  If not, then you won't get anything more.

I do have some product specific and process specific knowledge and history which would be helpful.   It is why they are offering me a Dec date. I can make an argument for:
1) needing additional incentive to stay based on personal circumstances, and
2) why me leaving prior to Dec would be extremely painful (something they likely already recognize, but I have details)

I just don't know if they will agree with my case.  I'm guessing this falls in the realm of "doesn't hurt to ask", but am looking for winning strategies.   So assuming I have a case, any tips on presenting it or the actual negotiation process?

Catbert

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Re: Talk to me about severance: Can I negotiate during site closure?
« Reply #6 on: October 27, 2016, 02:53:21 PM »
I'd *guess* that severance probably isn't negotiable.  It's probably just an arithmetic equation based on years of service, salary, job category.  If the megacorp has a union (even if you aren't part of it) it's even more likely that severance is set in stone.

You might have some flexibility to negotiate the retention bonus.  Try asking the HR rep if they know how it was determined.  If it's formula a la severance that might not be flexibility.  If the amount was determined by consulting tea leaves, there could be room to negotiate.

Capsu78

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Re: Talk to me about severance: Can I negotiate during site closure?
« Reply #7 on: October 27, 2016, 03:51:19 PM »
Not a strategy but more words of wisdom- Do everything you can to be friendly with the HR person.  Oftentimes their jobs suck to, especially during separation events like these.  My wife's 2 severance events were greatly aided by having been totally understanding of what the process was and both times HR found some "wrinkles" to assist my wife's transition.  They can be big advocates for you in closed door meetings.  In hindsight, both severances were more than fair to her, even though she met some dead hard stops on the decisions the severance team considered most important.   Good luck.

Emg03063

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Re: Talk to me about severance: Can I negotiate during site closure?
« Reply #8 on: October 27, 2016, 06:11:51 PM »
My advice:  make sure your role and responsibilities for the transition are clearly defined.  If they change as you go through the next few months, that's a negotiating opportunity.  If the severance is decent, and the expected workload is reasonable, I wouldn't push anything now.  No need to add stress to an already stressed company.  In the meantime, look for another job if you want or need one.  When you get an offer, that's another negotiating opportunity.  Be friendly and stay on good terms.  If they want to give you more work than you think can reasonably done in the expected timeframe, offer to stay on longer (either as an FTE, or on contract).  Be sure to offer to work from home so they can close up the office. ;)

jim555

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Re: Talk to me about severance: Can I negotiate during site closure?
« Reply #9 on: October 28, 2016, 07:47:19 AM »
The purpose of the severance is for you to waive your rights to sue them or talk badly about them.  They are not doing you a favor or being nice.  Your case gets stronger if they think you might have a case against them.  Things like age / sex discrimination, disability discrimination, etc. are what they are trying to avoid.


Axecleaver

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Re: Talk to me about severance: Can I negotiate during site closure?
« Reply #10 on: October 28, 2016, 01:26:12 PM »
Severance is very difficult to negotiate, because as Jim said, they only give that to people to reduce their odds of being sued. If you accept the severance, you will sign a form waiving your rights to sue for wrongful termination. There is very little incentive to increase the severance for a model employee.

Now retention bonuses, are entirely negotiable. You need to figure out who within the org cares about maintaining operations until they turn off the lights. That's the guy to talk to. It's not HR - they don't care about keeping the lights on. They only care about protecting the company from being sued. Definitely develop a relationship with them, because they can help you. But they are rarely involved in the decisions that impact the business's operations.

Your goal with the retention bonus is to understand what it would cost the company if you weren't there. Would they hire outside help? Accept the risk that something blows up? Or just close it down and forego the revenue for the last three months? Understand their financial risks and costs, and what you'll be mitigating for them by staying, and you can negotiate your own deal higher. Make sure to give your word that you'll stay to the very end. Your retention bonus will be written this way anyway.

TomTX

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Re: Talk to me about severance: Can I negotiate during site closure?
« Reply #11 on: October 28, 2016, 05:06:07 PM »
What's to stop them from firing you December 30th and skipping out on paying the bonus/severance? Or dramatically changing working conditions/expectations?

Everything needs to be spelled out. And you need to protect yourself.