Guide · Updated April 2026
Severance & Layoff Guide
The moment you were never supposed to need. Four things to know before you sign. Evaluate the package. Negotiate the terms. Check for WARN Act violations. Stack severance with unemployment.
Severance Package Evaluation
Market rate is one to two weeks of pay per year of service. Below that is a lowball. Above that is rare but real. Twenty-six weeks is the usual cap. Read your offer against the benchmark before you sign anything.
Read the full breakdownSeverance Negotiation Tactics
You have twenty-one days to review the agreement if you are forty or older. Forty-five for group layoffs. Seven to revoke after signing. Use them all. Ask in writing. More weeks, extended COBRA, pro-rated bonus, accelerated vesting, a reference letter. Pick four. Send one email.
Read the full breakdownWARN Act Timeline
Federal law requires sixty days of written notice before a mass layoff at any company with one hundred or more employees. If your employer gave you less, they violated the WARN Act. That means back pay and benefits for every missed day, up to sixty days, on top of any severance.
Read the full breakdownSeverance vs Unemployment
Most states let you collect unemployment and severance at the same time. Some do not. New York, New Jersey, and Massachusetts delay your unemployment benefits during the severance period. California and Texas do not. Know your state before you file.
Read the full breakdownFrequently Asked Questions
Am I legally entitled to severance in the United States?
No. Federal law does not require severance. Full stop. Severance is a private agreement your employer is offering you in exchange for a signed release of legal claims. The one exception is the WARN Act. If your employer violated it, you are owed back pay for the missed notice period whether they offered severance or not.
What is a typical severance package in 2026?
One to two weeks of base pay per year of service. Twenty-six weeks is the usual cap. Executive and long-tenured packages can reach fifty-two weeks. Health insurance continuation or a COBRA subsidy for three to six months is standard. Anything less than one week per year is below market, and you should push back before signing.
How much time do I have to sign a severance agreement?
If you are forty or older, the Older Workers Benefit Protection Act gives you twenty-one days to review the agreement. Forty-five if the layoff affects a group. After you sign, you have seven days to revoke in writing. If you are under forty, there is no federal minimum, but most employers will grant two weeks on request. Ask for it in writing.
Can I negotiate severance after I have already been let go?
Yes. As long as you have not signed. Once you sign, you are bound by the release of claims and the package is final. Before signing, the negotiable items are more weeks of pay, extended COBRA, a pro-rated bonus, accelerated equity vesting, and a written positive reference. Ask for all of them in one email.
Can I collect unemployment while getting severance?
It depends on your state. New York, New Jersey, and Massachusetts delay unemployment benefits until your severance period ends. California and Texas do not. File for unemployment the day you are laid off regardless of the timing rules. Your state agency will sort out the details. Do not wait.
Should I hire a lawyer to review my severance agreement?
For a standard layoff with a market-rate package, probably not. For an executive agreement, a package over twenty-six weeks, or any case that touches discrimination, harassment, retaliation, or whistleblower claims, yes. A one-hour employment lawyer consultation runs two hundred fifty to five hundred dollars and can surface leverage you did not know you had. Most lawyers offer free initial calls. Take one.
Sources & further reading
- U.S. Department of Labor: WARN Act overviewFederal notice requirements for mass layoffs
- EEOC: Older Workers Benefit Protection Act (OWBPA)21/45 day review and 7-day revocation rules
- U.S. Department of Labor: COBRA continuation coverage18-month health insurance continuation after layoff
- U.S. Department of Labor: Unemployment insuranceState-by-state benefit rules and eligibility
Orbyt was built for this.
Runway. Applications. Interviews. Wellness. All in one place. Not for the first week after a layoff. For every week until you land.