Severance Agreements in Georgia: A Guide from an Atlanta Employment Attorney

severance agreements

Losing or leaving a job is never easy, and the transition often comes with stress, uncertainty, and questions about what comes next. One of the most important documents you may encounter during this time is a severance agreement. These agreements can shape your financial stability, your career options, and your legal rights long after your employment ends.

As an Atlanta employment attorney with years of experience in Georgia workplace law, I’ve advised both employees and employers on severance agreements. In this article, I’ll explain what these agreements are, why they matter, and what Georgia-specific nuances you should know before signing or drafting one.

What Is a Severance Agreement?

A severance agreement is a contract between an employer and an employee that sets out the terms of separation. Employers typically offer money, benefits, or other perks in exchange for the employee’s agreement to certain terms—usually including a waiver of claims against the company.

Common elements include:

While this may sound straightforward, the fine print can carry serious long-term consequences.

Are Employers Required to Offer Severance in Georgia?

A key point under Georgia workplace law: employers are not legally required to provide severance pay. Unless there’s a specific employment contract, collective bargaining agreement, or written company policy that guarantees it, severance is discretionary.

That means when you’re offered a package, it’s not necessarily an act of generosity—it’s a business strategy. Employers often use severance agreements to:

  • Reduce the risk of lawsuits
  • Protect confidential information
  • Enforce restrictive covenants
  • Preserve reputation and goodwill

This is why you should never assume the terms are automatically in your best interest.

Georgia-Specific “Gotchas” to Watch For

One of the most important things I stress as an Atlanta employment lawyer is that severance agreements can hide pitfalls. Here are a few Georgia-specific issues I frequently see:

1. Restrictive Covenants Under Georgia Law

Since Georgia’s Restrictive Covenants Act took effect in 2011, non-compete and non-solicitation clauses are easier to enforce here than in many other states. What looks like “boilerplate” language can, in practice, bar you from working for a competitor or contacting former clients for a year or more.

2. Waiver of Age Discrimination Claims

If you’re 40 or older, the Older Workers Benefit Protection Act (OWBPA) requires that your agreement give you at least 21 days to review and 7 days to revoke after signing. In group layoffs, employers must also provide detailed disclosures. Agreements that fail to meet these rules may not be enforceable—but employers sometimes get the details wrong.

3. Wage and Overtime Claims

Under federal law, certain wage claims (like unpaid overtime under the Fair Labor Standards Act) cannot be waived in a private severance agreement without court or Department of Labor approval. Some agreements include overly broad waivers that look valid but aren’t. Without legal advice, employees often sign away rights they didn’t even know they had.

4. Tax Treatment of Severance

Severance pay is considered taxable income. The structure of payments—lump sum versus periodic installments—can have significant tax implications. This detail is rarely explained in the agreement itself, but it can affect your bottom line.

Why Employees Should Get Legal Review

If you’ve been presented with a severance package, it’s natural to feel pressure to sign quickly. But doing so without advice can be costly. An experienced Atlanta employment attorney can help you:

  • Spot unfair or overreaching provisions
  • Negotiate more favorable terms (higher pay, longer benefits, neutral reference language)
  • Ensure you’re not unknowingly restricted from future work
  • Verify compliance with state and federal law
  • Explain the tax and financial impact of the deal

Remember: just because the agreement is written in legal jargon doesn’t mean it’s set in stone.

Tips for Employers in Georgia

If you’re an employer, severance agreements are also critical tools. A poorly drafted agreement can expose you to unnecessary risk. Employers should:

  • Use precise, enforceable restrictive covenant language under Georgia law
  • Ensure compliance with federal requirements (especially for employees over 40)
  • Avoid overbroad waivers that may later be challenged
  • Consider non-monetary terms—like outplacement services or neutral reference policies—that ease transitions and reduce resentment
  • Work with counsel instead of relying on “one-size-fits-all” templates

Handled properly, a severance agreement can reduce litigation risk and protect your business reputation.

Practical Advice for Both Sides

  • Take your time: You may be entitled to a review period, especially in age-related layoffs.
  • Don’t rely on verbal promises: Only written terms are enforceable.
  • Review benefit continuation: Confirm health insurance, retirement, or stock options.
  • Think about the future: Today’s signature could restrict tomorrow’s opportunities.
  • Consult a lawyer: Even one consultation can save significant money and stress.

Why Choose Me as Your Atlanta Employment Attorney

I’ve spent years representing both employees and employers in Georgia workplace disputes, including severance negotiations and litigation. This dual perspective allows me to anticipate the other side’s strategies and secure stronger results for my clients.

My practice is built on three values:

  1. Clarity – I explain complex laws in plain language.
  2. Strategy – I know when to push, when to compromise, and how to protect your interests.
  3. Credibility – With a track record of success in severance negotiations, employers and employees alike trust me to get results.

Conclusion: Protect Your Rights Before You Sign

A severance agreement is more than a paycheck—it’s a binding contract that can affect your career, your finances, and your legal rights for years. Don’t let fine print or pressure tactics put you at a disadvantage.

Whether you’re an employee evaluating an offer or an employer preparing one, professional guidance makes all the difference.

👉 Call today to schedule a consultation with an experienced Atlanta employment attorney. Protect your future, understand your options, and move forward with confidence.