One of the questions we’ve gotten more consistently over time than any other (other than what we’ll do for health care) is whether we’ll try to negotiate some sweet golden parachute layoff deal for ourselves when we retire early. We’ve thought about it a ton, and have decided that that’s not how we roll. For a bunch of reasons.
But not that there’s anything wrong with wanting the soft landing. Just as we have a long list of reasons why it’s not right for us, there are some completely solid and totally-worth-considering reasons why you might come to a different conclusion. Let’s get into all of it.
Why We Aren’t Going to Try for a Severance Package
We know our work situation is not broadly applicable. We’re fairly unique these days in the sense of having built up super long tenures with (mostly) single companies. We respectively work for a small company and a smallish business unit within a megacorp, and we have long, personal, multi-faceted histories with the people who run the show.
Much of our hand-wringing about when to give notice and what folks will think is based on that last fact, not that we delusionally think we’re some irreplaceable unicorns whom our colleagues will mourn forever. (Ha.) We totally admit that there’s a huge emotional element to how we think about all of this. It’s definitely not 100 percent rational, although I’d argue that no decision-making is ever purely rational, though we might convince ourselves it is, which is itself an emotional decision.
Here are our rational and emotional reasons why we won’t be attempting to get ourselves laid off or negotiate a large severance on our way out the door:
We Don’t Need the Money — Would we like more money on our way out? Obviously. But do we need it? No. If we needed more money to make our early retirement work, we might have a totally different motivation to do this, but fact is that we won’t need to push for much more when it’s time to go. But it’s money the fat cats will just pocket instead! you might say. Not so for our companies. We know how personnel budgeting works, and any money we leave on the table will either go to our replacements or to other new hires. We’re cool with that. We wish more folks who weren’t stoked about their jobs would get out of the way to make more opportunity for those who are eager for it.
We Don’t Want to Claim Unemployment — A big reason to negotiate a separation is to be able to claim unemployment benefits. If you quit voluntarily (or get fired), you aren’t eligible. But we don’t want to be eligible. Both because we don’t need that extra funding, and because we’re likely to get health care subsidies if those subsidies survive, and we have no interest in doubling up on public benefits that could go instead to those who truly need them.
Our Companies Don’t Really Do This — Some companies offer buy-out packages or early retirement options regularly, but this isn’t a thing for either of ours, perhaps owing to their sizes. We know of folks who were told with plenty of advance notice when their last day would be and given the chance to find another job during that time, but only a few rare instances of true severance packages. (Admittedly, there’s probably stuff we don’t know. And this fact alone wouldn’t sway us if we were otherwise dead set on making this happen. Everything is negotiable, after all.)
It Feels Icky Given Our Long Tenures — Here’s the big emotional driver, and I know there are those who will say we are naive for thinking this way (see below). But we care a lot about doing this “the right way.” We want our employers to know that we’re early retiring, not just that we’re leaving. We want them to know we aren’t going to competitors, so aren’t a threat to them, and that we’re grateful for all of it. That feels like a tough needle to thread — demonstrating gratitude while asking for a payout to make us go away.
Our Retirement Plan Is Publicly Available — The last one is a biggie. You’re reading this post, which means that anyone on the internet can see what we’ve been scheming all these years. Soon our first names will be here, we’ll share the blog with more friends, and it’s likely our employers will make their way here (hi!). A big part of negotiating a layoff is using some excuse like family and medical leave or the intention to take a sabbatical or have a baby, and we have no desire to get caught in a lie like that when what we’ve been planning all along is here for anyone to see. (And if you want to get laid off and have been tossing around the idea of starting a blog, this might be a factor worth your consideration.)
We Know Work Is an Economic Arrangement First
To that naivete point, we’re not dumb. Though we consider our managers friends and mentors, we know they don’t pay us just because they like us. (If that job exists, please let me know. I want it.) We contribute (large) economic value, and thus are worthy of (less large) compensation. It’s fundamentally a monetary relationship first, and a personal one only after that. There’ve been some signals in recent years that have reminded us of this fact, so we haven’t lost sight of it. We know the score.
And if we’d only been in our jobs two years, three years, five years maybe, we would certainly see this a bit differently, and would recognize that there’s no shame in pursuing a mutually beneficial end to our work arrangement. (Because there isn’t.) But our desire to do this the right way, on good terms, is powerful motivation to not risk good vibes and good karma over a few bucks. We can always earn more money, after all, but we can’t necessarily repair relationships that we trash on our way out. And we still put people over money.
What We Will Ask For When We Announce Our Plans
Though we won’t be attempting to negotiate severance packages when we make our intentions known, there are several pieces we will absolutely push for. And we have a few pieces of leverage we can use in asking: 1. how long we stick around to make sure our clients have smooth transitions from us to new project leads and our colleagues get the benefit of downloading fully with us, and 2. the fact that we never signed non-compete agreements. All new hires have been signing them for years, but because we started ages ago, they missed the fact that we aren’t bound by the same agreement. I sure bet they’d really like us to sign those things before we go…
This Year’s Full Bonuses — Our bonuses are in large part deferred compensation, and we have every intention of getting the full amounts we believe we’ve earned by continuing to work hard this year. This is more true for Mr. ONL, but I’ll be pushing for my smaller deferred compensation, too.
Future 401(k) Match — Mr. ONL’s match comes at year’s end, and he’ll be entitled to the full match, which he’ll push to receive (and we don’t anticipate any problem there). Mine has murkier rules, and the match for the prior year doesn’t come until summer. But given that I’ll be working this full year, I have every intention of making sure I get the match I’m entitled to, even though I’ll no longer be employed when it’s delivered.
Why You Might Want to Try to Negotiate a Severance Package
Of course, just because we aren’t trying to get ourselves laid off doesn’t mean you shouldn’t try it. Our situation is unique in some ways, especially for Gen X and Millennials, and it might make total sense for you to soften your landing even though we’re not going to try to.
Here are some good reasons you might choose a different approach from ours:
Your Plans Aren’t Public — If you haven’t chronicled your journey and plans for all the world to discover, you may be able to get away with negotiating a layoff.
You May Work Again — If you aren’t leaving your job to retire for good, negotiating a separation gives the opportunity to get in writing that your employer will always serve as a positive reference for you.
Your Tenure Is Shorter, or Your Employer Is Faceless — There might be some aspect of wanting to stick it to the man, and we get that. If your employer is some huge, heartless megacorp, then go ahead and milk it for what you can get.
You Want to Claim Unemployment — If you want to be able to get unemployment benefits, then negotiating a layoff is your best option to be eligible. Quitting like we’ll do makes you ineligible.
Your Company Offers Buy-Outs — Maybe the best reason to take a severance: if someone dangles it in front of your face. If we had that offer available to us, we’d take it in a heartbeat to make way for others who want our jobs more badly than we do.
Health Care Is Super Important to You — Severance packages often include some period of company-paid health insurance. If you or a loved one have a desperate need for continuous health care coverage and you’re otherwise secure enough to retire, you might want the health insurance benefits of negotiating a package.
You Don’t Feel Icky About It — A harder to define reason, but an important one. If you don’t have any ethical or moral qualms about asking for a severance, and you don’t think that doing so will make it hard for you to look yourself in the mirror after you make the ask, then rock on.
The list of reasons you might logically and ethically conclude a negotiated severance is worth pursuing is longer than our list of reasons why we aren’t going to do that. So there’s no wrong answer here. Only, as usual, the answer that feels right for your specific situation.
Let’s Talk About Your Exit
How do you plan to exit when it’s your time? What factors weigh most heavily in your thinking about it? For those of you who have already quit, how did it go down? What would you do the same or differently, with the benefit of hindsight? Anything you think the rest of us should know? Let’s discuss it all in the comments!
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Categories: gearing up
I’ll probably just give an extended notice. It depends on which position within my Megacorp I leave from. This position? At least two months notice. Another position? Maybe a month. I don’t think I would try to negotiate any severance when I leave as I doubt I’d be successful. My company doesn’t do that sort of thing unless it’s an incentive program to get all the old people out of their chairs. I would time my exit strategically, though. I’d be eligible for the bonus if I stayed past September of the calendar year, so I’ll most likely quit in the fall. Sounds like it would be a lovely birthday present!
One thing worth considering: negotiated separations are rarely made public and are generally subject to a non-disclosure agreement. So it COULD be that these things happen all the time, or at least sometimes, and it’s just not widely known. If you’d otherwise be inclined to go for it, you might as well do a little extra hard listening until you’re ready to pull the plug. ;-)
Where I work now, if ever I would want to exit (no single braincell considering this right now) I do want to be open and honest, especially when the reason is FI.
An exit for me would be to stop working and come back the day after as external consultant. In myv FI plans, being a freelance is a big part. Having a kick start here would be ultra sweet.
I think that’s a great way to approach it: not trying to negotiate for more money on the way out, but instead to keep open the very real possibility of future work together. Some folks have shared here that they managed to keep working with a company after receiving a severance, so it’s possible with some companies, but certainly not all!
As usual a thought provoking post. I had suggested Mr ONL stay on a few months into 2018, change his 401k contribution to essentially max his 18,500 limit over a few paychecks take the match (free money) and leave in March or April. If they don’t pay until year end then I guess that’s not a strategy
For me negotiating a layoff isn’t the way to go. Getting paid not to compete, taking money in the form of a consulting fee for a set number of hours over a defined period of time to aid in any transition seems like a good use of your negotiating power should you want it – and get them to pay your cobra for 2018 could be a strategy.
It’s not about the money as much as its about easing the transition into not working. There is a physiology to the transition from work to not working. Stopping anything cold turkey is bound to have some downside. If you have insight on this it would be super helpful for your followers. Everyone I ever knew who retired who eased in vs. quit cold turkey had a better re-entry relative to their personal relationships.
If you two haven’t spent every waking hour together for a month that didn’t include or was part of a vacation you should test yourselves (or if you have share your experience). It isn’t as simple as it sounds. I am interested in how you have thought about it
As usual keep up the insights and thanks for sharing
Thanks, Phil! Our reasons for being dead-set on year end will become clear very soon! ;-) But definitely appreciate you sharing your great thinking either way, even if we aren’t in a position to benefit from it.
As for the transitional stuff, I’ve written a little bit on that (https://ournextlife.com/2017/06/14/make-time-for-whats-important/), but plan to talk much more about it, especially once I can speak from experience and not just speculation. ;-) And I agree with you on married people getting more accustomed to time together. If we hadn’t worked in the same small place for many years now, done many nonstop-time-together backpacking trips and dealt with some stressful stuff together (home renovation, moving aging relatives, etc.), I’d want to make sure we’re set there, but I think we’re good. :-)
Yeah, it would be a little odd to ask for more money after publicly say that you have all this money saved up so you can retire ridiculously early (by most people’s standards).
If you had pitched it as, “I’m burnt out by this kind of work and I am just going to jump into some unknown new thing without a net”, it would be much, much easier.
However, as you say, even if it was easy, it simply might not be the right thing to do.
Haha, yeah. Kinda problematic like that. But even without the whole blog problem, I still don’t think we’d feel good about misrepresenting our intentions.
Fascinating run down of your options and reasons for not negotiating for severance, but why one might. # 2 (Don’t want to claim unemployment) and #4 (feels “icky”… perfect word!) particularly resonated with me. These two points make it clear to me that your motivations and thinking towards retirement and the options for sustaining yourself financially are aligned in a good way (you want to be fair to both your employer and fellow citizens of the U.S. by not rely on subsidy money that could elsewhere or taking more than you need from an employer who has treated you well).
I truly meant what I said in the post: that we don’t judge others who might wish to make the opposite decision and push for a severance package. It just doesn’t feel right (or even possible, frankly!) in our case. :-)
I can understand where you’re coming from. My main reason is that I’m not one for confrontation so negotiating when I don’t have to seems like more hassle than it’s worth.
I don’t like to make a big deal of things or be the center of attention so I’m kind of hoping to slip out quietly when that time comes.
When my dad retired from an accounting position with a university, he had something like 60 sick days saved up so I was trying to convince him to use them in the months before he retired but he refused. He also went back after retiring to train his replacement, even though he wasn’t being paid. There’s definitely more weight to the relationships than people may think and his actions speak to that. He even goes back every few months to have lunch with former coworkers (and fellow retirees).
Negotiating a severance finalizes the relationship, by signaling a definitive end in all aspects. Why do that unless you absolutely need to?
So this is where I will make myself a hypocrite, because I think in your case, you should reconsider! ;-) Not asking for a package just because you don’t want to do the asking isn’t enough of a reason on its own, and as Sam points out later in the comments here, women are MUCH less likely to push for a severance while men do it with no guilt. (Obviously that’s a broad generalization.) So not to pressure you, because you have to do what feels right to you, but let me know if you need a pep talk at some point. ;-)
Ok, it’s something I’ll think about. Aside from the gender aspect, it’s just not considered “Minnesota Nice.”
As I’ve gotten older, I’ve become more comfortable with confrontation so maybe at that point I won’t have any reservations about negotiating a severance. I just want to make sure I don’t do anything that would create problems if I ended up reentering the workforce. Minneapolis is big but not that big — people definitely talk!
I might have said that with too much pressure! ;-) No pressure, I promise. I just know I think about things differently when I recognize the gender bias stuff. It’s why I pushed for more money last year, though it didn’t make a real difference. I felt like I had to do it for the other ladies. But I definitely think you’re smart to think through all the potential impacts either way!
Another reason not to take unemployment that follows the same reasoning above (when you have a long, good relationship with a smaller company) is that the employer pays a part of that cost, which would somewhat defeat the purpose of not negotiating a severance to begin with. I work for a really small company and paying unemployment can hurt :)
Yeah, totally! I’ve observed that as well.
Thanks for sharing this! I do agree that it would feel icky to double dip on funds assistance, either through your employer or through government benefits. I think what you guys plan to ask for is completely reasonable. Given your long tenure, I’d be shocked if your employer refused to give your annual bonuses. Good luck on quitting lol! :)
Thanks for the well wishes! And I think we each have to find our own “ick line.” ;-)
Totally understand and relate! I plan on giving a looong notice and friends think I’m crazy for that, and argue that the company and owners wouldn’t be that nice to me in a different situation. But I have personal relationships that prevent me from being selfish and wanting what’s best for the company.
At the end of the day (or the year in your case), I want to be able to put my head on the pillow at night and know that I did the right thing for ME, that there is no guilt of my own perceived wrong doing during the process that keeps me awake at night. And that’s what you all are doing too….making sure you can live at peace with your decisions.
Others may not do the same in similar situations, and that’s okay. Though you might could get “more” out of your exit, you have a conscious, and you don’t want it nagging at you for the rest of your long retirement!
One of the best ways to eradicate guilt for getting paid a severance is to provide for an awesome transition and leave the place better off than you found it. That can encompass training your replacement for months, or closing some great revenue generating deals etc.
And always remember, the reason why anybody has a job in the first place is because they generate more revenue than they cost. Add tremendous value, and they’ll be completely happy to give you a severance. add disappointing value, and they can’t wait for you to quit.
Good points Sam. There’s no one right approach, every situation is different. I certainly wish I could pull off a severance as I leave, because who wouldn’t want the extra money, but it’s just not something that works for me.
Totally agree! And yeah, same here that it’s not an option or a good choice for everyone. :-)
Ha — all well said! Regardless of our plans around a severance, we definitely believe in adding value to the end!
Yeah, you totally described our thinking in many fewer words! ;-) In your case, I’m sure your friends have already advised this, but just be sure you have all the money you need before you give notice — just in case. Part of why we feel okay not pushing for more is we know we’d be okay with what we have now… though we’d for sure still like to pad everything a bit!
Mr. Montana gave 8 weeks notice, and asked for nothing in return. He worked for a smaller non-profit and really cared about the work. Towards the end, they asked him to stay on longer, and he gave one extra week. But because we had been planning it for 6 months, there were a lot of things planned for that first month off. So even though they weren’t entirely ready for him to go, he had to walk away after that.
We are still really active in the social service work/community. (He serves on a board of another similar non-profit now.) And I’m sure in the next 5-10 years will find larger ways to be a part of it either as volunteers or paid positions. So not something we wanted to just take from and then leave town so to speak.
That’s a great point, too — that pushing for something on your way out could poison the well. In plenty of industries, layoffs and golden parachutes are normal, but in nonprofits, asking for a big payout could definitely burn bridges.
You make some good points. It would definitely feel a little weird negotiating a severance if you guys have been so public about your wealth, hence my Stealth Wealth predisposition.
If people don’t need or want the money, that is totally fine. For those who feel they would like some financial breathing room before figuring out what to do next or to start a business or to spend time with a sick family member etc, negotiating a severance is can be a HUGE life saver that minimizes stress and maximizes happiness.
Having 5 years worth of severance that ended in 2017 helped me calm the nerves, take time for ourselves, and just write whatever we wanted w/out the need or focus on money. It took about 2 years post Corporate America to really feel 100% that we’d never return. You never 100% know after you retire early in the beginning. I was 75% – 80% sure I wouldn’t return, but not 100% sure.
The irony is, the better the employee you are and the longer your tenure, the MORE they will want to give you a severance. Don’t forget the actual severance amount, a check equivalent to often 1-3X weeks of pay a year in service.
I just want more employees to believe they have more control over their destiny and more power as employees than they know. Who knows, your severance might allow you to do great work that gives back and helps more people than you could possibly have imagined!
I immediately thought of Sam’s book when reading this post.
I think the key with any of these big decisions is to be true to yourself and your morals. No amount of money is going to be worth an ongoing feeling of regret, if you did something you can’t feel good about in the coming years.
But if you’re fine engineering a layoff and a severance, and would feel proud enough about it to share it with friends and loved ones, sure, why not? Why not get the extra money and benefits if you’re not violating any of your personal ethics?
Amen to all of that! I totally respect that lots of people have no ickiness around this stuff, but we do. Especially because we’ve been treated well and fairly throughout our careers and know that a negotiated exit would be dishonest. No amount of money would erase that feeling. And YES! For those without that hesitation, go forth and negotiate! :-)
Hi Sam — Thanks for being so engaged in the comments here! I feel like we all got some free expert consulting time! ;-)
I’m 100% with you on the reasons why folks may want to negotiate a severance, which is why I titled this post the way I did. It just turns out that we don’t quite fit that model, but no judgment for folks who want to pursue a negotiated exit! Thanks for writing the definitive resource on the topic!
I actually hadn’t ever considered that you ~could~ negotiate a severance when voluntarily resigning… and now I feel like a dope. Oh well. As it turns out, I echo many of Mrs. ONL’s reasons for not pursuing one, and I’m happy enough to have agreed on an end date with no bad feelings on either side.
At the end of the day, it’s just money. As long as you feel secure after you’ve left and are happy, that’s all that matters in the end.
If you work for a firm that was paying multi million dollar severance packages to executives for not doing their job, that’s a different story. Then every employee should ask, “without me too?”, especially you’ve done a great job!
Oh amen to that! If we saw others getting big golden parachutes — or getting paid big bucks for incompetence — we’d definitely be seeing all of this SO differently.
Oops, I meant to say “Why NOT me too?!”
This is a powerful question to ask whenever you have self doubt.
Agree 100%! Not just talking about layoffs, but about any decision, it’s so easy to compare ourselves to the top tiers and think we must be the best to even try. Which is ridiculous. Thanks again for being our resident expert on this one, Sam! :-)
Congrats on getting to the end date with good vibes! That’s soooooooo wonderful!!
Interesting topic for sure. I work for a megacorp, and after recent restructuring I actually have no idea who my ‘boss’ is. There’s no direct hierarchy, no HR department, no resources for us, even though it’s one of the largest employers in all of healthcare. Hmm.
I get no benefits, and at part-time, I’m not even guaranteed any work, so sometimes I don’t get any. It’s hard to have loyalty in a situation like this. However, I also lack leverage, so when it’s time to leave, they probably won’t even bother to warn me about the door hitting me on the way out.
I’m slowly putting the pieces together. :-) That lack of structure sounds maddening! And the lack of loyalty you receive. In situations like yours, I’m like, “Get that leverage and find a way to make them pay you on your way out!” ;-)
Hubby dearest was forced to retire early by being putting on call 24/7 365 day year, something supposed to be only during nature disasters and such and only for doctors not professors. He only left after taking everything he could with him on his way out the door including six months salary. Some employers don’t deserve consideration.
100% with you on that. If we’d been in any way mistreated or disrespected, I think we’d be viewing all of this very differently!
I’ve always thought if you give the notice then you won’t get a severance package, or am I wrong on that?
What about asking work to cover your health insurance for a year or so? Is that possible?
BTW, nice pic of Canadian Parliament Building.
I LOVED my short visit to Ottawa to see Desirae from Half Banked! :-) So I think if you wanted to negotiate a severance, you wouldn’t give notice the same way. You’d approach them about laying you off, which Sam outlines very well in his book. And I’m sure there are folks out there who’ve negotiated health care in the past, but my understanding is that the current rules make that more difficult.
Like all things this is really personal. I share most of your viewpoints and have very similar reasoning and so did not even consider trying this, though it may have been possible to work that angle.
On the flip side, the Mrs. did work out a severance package after engineering her lay off a few years ago, when her then company was getting rid of people and she was pregnant and wanting some time off anyway. She was able to get a pretty sweet package that included forgiving tuition for the degree that the employer had paid for as well as several months of pay while allowing someone else in the company who would have been laid off and needed and wanted the job more than her to keep it. Win-Win.
How awesome that Mrs. EE got such a great exit package! If our companies were going into layoffs, this post would be VERY different. We would 100% volunteer to get the early push. But that’s not on the table, and so given our circumstances, we aren’t inclined to push for much on the way out.
As someone who just negotiated a very good package I think you are making a mistake. I can understand the comment about it being a small company but think about some of the following:
1. More money is better than less money. You might not need it but that added buffer could add to your security if there is a big market move or just provide a little extra fun money.
2. If you are like me (been with my employer for 20 years), I was sick of watching underperformers being ‘let go’ with a nice redundancy package. Surely, as a high performer you deserve at least the same treatment (and probably better)?
3. You haven’t signed a non-compete and maybe you will never want to go back to work BUT an exit package could easily be traded against your future loyalty either by a guarantee not to compete or possibly an option to return.
4. It might feel ‘icky’ but believe me, firstly memories are very short (there will be someone moving into your office within a week) and, secondly, this is the natural human reaction and probably why so many people hate negotiating (I don’t). Negotiating a package should be a purely business discussion clearly separate from your personal day to day relationships. You just need to find out who the right person is to have that conversation with.
5. There are no second chances and at the end of the day they can only say no.
Publishing your whole story on the internet could of course be a little awkward (and its for that very reason mine is also an anonymous blog!)
My package is a reduction to one day a week for 12 months followed by a cash settlement. But what’s most important is both sides feel happy. I feel happy because its an additional buffer while I get my head straight about early retirement and they feel happy that it keeps me loyal to the business and possibly the chance to get me back.
So I am clear where I stand.
Congrats on your severance negotiation! Good point in #2.
Also, 20 years of service is a long, long time. It’s the top performers who ironically who are most deserved of a severance package, yet it’s the underperformers who end up getting one instead.
I’m super stoked for you that you negotiated a great package for yourself! Congrats! And your reasons in your situation make total sense. They just don’t fit our situations or priorities. Which, for starters, includes the extremely long odds that we could even successfully negotiate something like this in either of our companies, which have historically not laid off any real numbers of people.
I negotiated. I had worked there over 30 years. It wasn’t icky it was just an extension of trading my time and knowledge for their money. I didn’t need it but I knew it was available. As far as it going to others if I didn’t take it, I know you said that was true for you but I find that very hard to believe. If I took it from anyone it was from the shareholders. Plus the company wanted me to feel good and talk good about them since my network of contacts nationwide was at least equal to theirs and my good will was worth something to them in terms of preserving and building their brand. They still threw me the retirement parties and dinners and I left on excellent terms and they remain a consulting client for two of my side gigs but the idea of walking away from free money at the end. I’m sorry but that is just cray cray.
Congrats on your severance! There used to be a time when after 30 years of service, you’d actually get a pension.
I’ve been consulting with individuals on how to negotiate their severances for the past 5 years. What I’ve noticed is that views on severance negotiation are much different between men and women.
Women tend to feel bad or guilty about negotiating a severance. They are less confrontational. Men are more willing to negotiate and ask what they deserve or think they deserve. I’ve observed this phenomena over and over again, which may be part of the reason why there are differences in pay between men and women at the same level.
There’s still companies here and there that offer them. I just vested in mine! Only took me 5 years with the company to do so! Gwen
Thanks for sharing that, Gwen!
That gender difference is super interesting! For what it’s worth, Mr. ONL is even more anti-severance than I am. (Though we both acknowledge that we’d definitely be volunteering if layoffs were actively happening — that would be a totally different situation.)
I’m sure you understand I can’t get into my company’s financials or structure, so you just have to take my word for it that I know what I’m talking about. ;-) I think if I knew money not given to me on the way out was just going to shareholders, I may very well view this quite differently! It’s great to have your example, though, of negotiating an exit deal and still being treated so well on your way out!
I will give my company 6mos to a year notice of my “actual retirement date” even though I have been bringing up succession planning for the last 4 years. I would enjoy consulting part time as a transitional phase and our company has a history of this practice. Overall they are a great “smallish” publicly traded company and after 25 years with them I would expect them to play fairly when I decide to leave, however I will time it so that my incentive compensation and annual PSRP Match are in my account before I leave.
That’s smart of you to hedge against any unfair play at the end by making sure you’ve banked your bonus and match first! Fingers crossed they DO play fair, especially after 25 years of loyalty from you!
I can definitely understand and respect your reasons for not negotiating a severance.
In my own situation, I was not a ‘long timer’ at my last job and had no emotional connection to the company or its people. They had a lay-off about a month before our annual bonuses were going to be announced. I suspect it was intentional.
So I definitely angled for a severance.
I also live in a state with employment insurance, but it’s more like a forced savings plan. I never felt bad about getting back the money I contributed into the system. Those were my dollars after all!
Oh, if we were about to have a round of layoffs, this would be a very different post! I’d be first in line! But that’s not what’s happening right now, and has in fact been vanishingly rare at both of our companies (which is a good thing!). Glad you were able to get exit with a good deal!
At this point I would at least try to negotiate keeping my golden parachute ie RSUs. After all I’ve earned them already and they are a major chunk of change that vest over years.
That is the right attitude. You did earn them, and to have them be taken away doesn’t feel right. I negotiated mine and they said no problem. I earned them! But most people are too afraid to ask so they don’t and quit.
No disagreement here! 100% yes in favor of demanding every bit of earned compensation in every form!
As you should! You definitely earned that compensation and should get the benefit of it.
I recommend that you request a copy of your 401k plan’s SPD from your HR department. The rules should not be “murky” at all. The SPD will tell you if you have to be actively employed to recieve the match when it is deposited, which is common. Plans have to be administered consistently with their writtten plan rules, so this may not be something you can negotiate. You may need to try to negotiate the equivalent amount be added to your year-end bonus, or some other workaround.
Good advice! And we’ve done this! But there is still more gray area than there should be, which is why we’ll have the conversation and get things in writing. ;-)
This is a GREAT post (again). Encapsulates everything I thought through and then some (as always). Negotiating a layoff crossed my mind but felt wrong as I would have had no intention of getting employed again. Funemployment sounds awesome but I want that money to be there for the people who need it. I walked away with plenty of notice, bridges and more importantly integrity, intact. Colleagues were left with deals in process and long term relationships I had developed over the years. Though the next chapter is just starting, I feel I started without any baggage (at least in the work department, lol). On another subject, I’m impressed you keep thinking about cool stuff to talk about.
Thank you! I definitely hear you on integrity. I didn’t talk about that here, because it’s squishy and hard to qualify, but yeah, asking for a severance would just feel like an integrity compromise to me. Not that I judge it that way for others, but there’s no escaping that I would carry that sense of ickiness with me, and that’s not worth some extra cash. As you say, no use freeing ourselves just to carry around that old work baggage, ickiness included! ;-) (And re: topics, you should see the running list I keep in Evernote — it only ever gets longer, not shorter! Haha.)
I agree with your noble intentions of leaving more money for your colleagues and of not collecting unemployment benefits. An engineer I can’t help but wanting to optimize, though. The money would probably be more helpful when being given to a charity. I would consider negotiating a severance package, and then donating the money to a charity. Your colleagues and friends will find out about your reasons soon enough when you write about the details here later, which will reduce the ickiness factor.
One of the things managers do is give themselves high fives when employees quit bc it saves them money, and more importantly the headache of trying to lay someone off.
But like you said, you can always use the severance money to help someone in need. Bc the money will just be kept on the companies balance sheet for who knows what.
I love that idea — using the money for a good cause.
I think that’s a completely great approach for lots of folks — it’s just unlikely to work with our employers for reasons we can’t share here. ;-) But I LOVE the idea of negotiating a big check to hand over the worthy causes! What a great parting gesture!
I’m not sure what the bit about collecting unemployment benefits has to do with this decision. First of all, collecting unemployment benefits is not automatic or mandatory, even if you are eligible. So if you don’t want them, don’t apply for them. Second, as far as I know (from personal experience, though this may not be true in all states) there is a requirement that you actively search for work to maintain your eligibility. So if you are not looking for a new job while collecting the benefits you will lose eligibility, no matter the nature of the separation from your previous employer. Maybe I’m just quibbling here, but your discussion gives a misleading impression of how UI benefits work in the US.
If it wasn’t clear enough, here’s how I meant it: If we DID want to collect unemployment benefits, which some may want to do, it wouldn’t be possible to do so if we’d willfully quit (or been fired). We’d need to have lost the job involuntarily through no fault of our own, which is where negotiating a layoff or separation agreement would be essential. But because we don’t want or need to collect unemployment, that factor doesn’t sway our decision not to try to negotiate something.
I’m in a weird nether situation. I have a temp job that will let me go with two-hour’s notice once they decide the project is over. I have a business with clients who have long-term needs from me. The skill I’ve been building on the side is to double my temp job pay. Once I am able to get on one of those projects, I will inform my temp job that I’m gone effective immediately. Unless, the new gig is a short term gig. In which case, I will let my current gig know that they could keep me if they release me for the duration of the well paid gig. For my business, I will eventually stop taking clients when I start feeling that I would like to retire. Anything I just can’t finish because of my retirement goals, I will find a suitable alternative for my clients.
Your situation sounds so stressful in that you don’t have the job security that a lot of us take for granted! I hope you get to a place of a bit more work certainty soon! <3
Thank you! More certainty is probably a non-starter since I’ll have to continue finding clients, but more money security will make that much easier to handle.
What’s that quote? You can’t stop the waves, but you can learn to surf. ;-)
That sounds about right.