Dear Rachel,
I read with interest your column last week in which you responded to the person who had just been laid off after 10 years with his agency. I am writing about a dear friend who finds herself in the same sad boat. I know she will find another job at a senior level but in the meantime she knows nothing about what to expect as an exit package from her current agency, and she has her exit interview coming up shortly. What can a person with a decade or more of experience expect in terms of a payout in a downsizing? My friend will be guided by what you say.--
Friend of a friend
Dear friend,
There are two answers to your question. The first answer is that she will get what they give her, if she is willing to accept it.
The second is that she'll get what she manages to wiggle out of them by playing her cards right and not accepting the package they first put on the table.
We can assume that the second deal ought to be a better than the first.
The rule of thumb used to be a payout of one week based on each year with the agency, but these days it's the Wild West out there when it comes to severance packages, observes Kurt O'Hare of O'Hare and Associates, a New York recruiting firm.
Key is what the agency is offering others who are being let go.
"I think one of the best rules of thumb to go by is 'usual and customary'--what is the usual and customary severance package for someone with a certain level of tenure. So if your friend is part of a broader layoff, they should be entitled to the same package as other people at his level with similar terms of service. But again in this market it depends a great deal on how much money the agency needs to 'realize' by laying off staff."
O'Hare thinks your friend would do well to receive three months' severance, including any paid vacation time.
But she should also be looking to include healthcare/cobra coverage for the severance period, or to convert it to a few weeks of pay. She might also be looking for a month or two of outplacement services to help her find her next job.
But in any case, your friend needs to be prepared to make her best argument for the best package she can get, without taking the first thing that's offered by human resources.
Come back with a counter proposal.
"If HR says no," advises O'Hare, "call your boss or a step or two above and talk to them. It's not that HR is playing hardball. They are tasked with implementing the decision. What you want to do is try to get the decision changed."
Karen Katz, principle of the Forum Group, another New York recruitment firm, agrees.
"Don’t immediately say yes to any offered package. Push for whatever else you can get. It’s your last trip to the well, and get the bucket down into the water as far as it can go.”
As in every negotiation, there is the dollar side of things, but there is also feeling and sentiments, and they do count. Managers feel bad about letting good people go.
Your friend should appeal to those feelings. It could make a difference. Says Katz: "In this economy, I have come to believe that a company’s guilt feelings regarding the termination drives the package that someone receives."
And by all means your friend should visit with a lawyer as soon as she can, ideally one who works in the area of employment issues. She needs a legal reading on what she's entitled to, and she may well choose to have the lawyer negotiate the package as well.
"I strongly recommend that everyone consult an attorney before signing any severance agreement so they are fully aware of their rights and limitations," says O'Hare.
