Severance Agreement - Massachusetts

SEVERANCE AND MUTUAL RELEASE AGREEMENT

(Massachusetts – Single Employee Separation)

TABLE OF CONTENTS

1. Document Header
2. Definitions

3. Operative Provisions
   3.1 Severance Benefits
   3.2 Final Wages and Other Amounts Already Owed
   3.3 Additional Consideration
   3.4 Taxes & Withholding

4. Release of Claims
   4.1 General Release (Employee)
   4.2 Mutual Release (Company)
   4.3 ADEA/OWBPA Compliance
   4.4 Protected Rights

5. Covenants & Protected Rights

6. Representations
7. Default & Remedies
8. Risk Allocation
9. Governing Law & Dispute Terms
10. General Provisions
11. Execution Block

1. DOCUMENT HEADER

THIS SEVERANCE AND MUTUAL RELEASE AGREEMENT (this “Agreement”) is entered into as of [DATE] (the “Execution Date”) by and between [EMPLOYER LEGAL NAME], a [STATE] [ENTITY TYPE] having its principal place of business at [ADDRESS] (“Company”), and [EMPLOYEE FULL NAME], residing at [ADDRESS] (“Employee”). Company and Employee are sometimes referred to herein individually as a “Party” and collectively as the “Parties.”

WHEREAS, Employee’s employment with Company will terminate effective [TERMINATION DATE] (the “Separation Date”); and

WHEREAS, Company desires to provide Employee with severance benefits in exchange for a full and complete release of claims, and Employee desires to accept such benefits on the terms and conditions set forth herein;

NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, the adequacy and sufficiency of which are hereby acknowledged, the Parties agree as follows:

2. DEFINITIONS

For purposes of this Agreement, the following capitalized terms have the meanings set forth below. Defined terms appear in alphabetical order and apply equally to both singular and plural forms.

“Agreement” has the meaning set forth in the preamble.
“ADEA” means the federal Age Discrimination in Employment Act, 29 U.S.C. §§ 621 et seq.
“Claims” means any and all actual or potential actions, causes of action, suits, arbitrations, administrative charges, grievances, complaints, controversies, demands, debts, damages, losses, attorneys’ fees, costs, liabilities, and obligations of every kind, in law or equity, known or unknown, suspected or unsuspected.
“Effective Date” means the eighth (8th) calendar day after Employee signs this Agreement without revocation.
“OWBPA” means the Older Workers Benefit Protection Act, 29 U.S.C. § 626(f).
“Revocation Period” has the meaning set forth in Section 4.3(c).
“Severance Amount” means the gross cash payment specified in Section 3.1(a).

3. OPERATIVE PROVISIONS

3.1 Severance Benefits

(a) Severance Payment. Subject to Employee’s timely execution and non-revocation of this Agreement, Company shall pay Employee a lump-sum cash payment of $[•] (the “Severance Amount”), less applicable taxes and withholdings, within ten (10) business days after the Effective Date.

(b) COBRA Subsidy. Company shall pay the employer-portion of Employee’s COBRA premiums for [NUMBER] months following the Separation Date, or until Employee becomes eligible for comparable coverage, whichever occurs first.

(c) Outplacement Assistance. Company shall provide professional outplacement services through [VENDOR] for up to [NUMBER] months.

3.2 Final Wages and Other Amounts Already Owed

Regardless of whether Employee signs this Agreement, Company shall pay all earned wages in the time required by Mass. Gen. Laws ch. 149, § 148:

• if Company discharges Employee, payment in full is due on the discharge date; or
• if Employee resigns, payment in full is due on the following regular payday, or on the following Saturday if there is no regular payday.

Wages include holiday or vacation payments due under an oral or written agreement. Earned, unused vacation must be paid at separation; general PTO should be reviewed under the governing written policy and Massachusetts Attorney General Advisory 99/1. Commissions are governed by § 148 when definitely determined and due and payable. Approved expenses, vested benefits, and other amounts owed under a plan, policy, collective-bargaining agreement, or contract are not severance consideration. Employee identifies any known unpaid-compensation issue here: [________________________________].

3.3 Additional Consideration

The severance benefits are in addition to anything Employee is already entitled to receive and are exchanged for the release and lawful promises in this Agreement.

3.4 Taxes & Withholding

All payments hereunder shall be subject to required deductions and withholdings. Employee is solely responsible for any additional tax liabilities.

4. RELEASE OF CLAIMS

4.1 General Release by Employee

In exchange for the additional consideration provided herein, Employee, on behalf of Employee and Employee’s heirs, executors, administrators, successors, and assigns, releases Company, its parents, subsidiaries, affiliates, predecessors, successors, and current or former directors, officers, employees, and agents (“Released Parties”) from Claims arising on or before the date Employee signs this Agreement, including lawfully waivable employment-discrimination and retaliation claims under the ADEA and Mass. Gen. Laws ch. 151B, § 4, and other lawfully waivable federal, Massachusetts, local, or common-law claims.

This general release does not waive (i) Claims arising after Employee signs, (ii) earned-wage, vacation, or commission rights under Mass. Gen. Laws ch. 149, § 148 or remedies under § 150, (iii) vested benefits under governing benefit plans, (iv) unemployment or workers’ compensation rights, (v) rights under this Agreement, or (vi) rights that cannot lawfully be waived. Any separately negotiated settlement of a known wage dispute must be expressly identified and drafted by Massachusetts counsel; it is not supplied by this general release.

4.2 Mutual Release by Company

Company releases Employee from Claims arising out of the employment relationship on or before the date Employee signs this Agreement, except Claims based on fraud, embezzlement, intentional misconduct, or rights under this Agreement.

4.3 ADEA/OWBPA Compliance

(a) Knowing and Voluntary. If Employee is age forty (40) or older, this release of ADEA Claims is intended to be knowing and voluntary, is written to be understood, and specifically refers to rights or claims arising under the ADEA.

(b) Consideration Period. Employee is advised in writing to consult with an attorney before signing and has at least twenty-one (21) calendar days to consider the final Agreement. Employee must not sign before the Separation Date. If the waiver is offered in connection with an exit incentive or other employment termination program offered to a group or class of employees, replace twenty-one days with at least forty-five (45) calendar days and, at the beginning of that period, provide a written disclosure calculated to be understood by the average eligible employee that identifies the decisional unit, eligibility factors and time limits, job titles and individual ages of all eligible or selected employees, and individual ages of employees in the same job classification or organizational unit who are not eligible or selected.

(c) Revocation Period. Employee may revoke this Agreement within seven (7) calendar days after signing by delivering written notice to [COMPANY CONTACT AND ADDRESS]. This Agreement shall not become effective or enforceable until the eighth (8th) day after Employee signs without revocation.

(d) No Waiver of Future Claims. Nothing herein waives rights or Claims that may arise after Employee signs this Agreement.

(e) Final Offer. Material changes to the final offer restart the applicable twenty-one- or forty-five-day consideration period unless the Parties agree otherwise. Employee may sign sooner only by a knowing and voluntary choice that Company has not induced through fraud, misrepresentation, a threat to withdraw or alter the offer before the period ends, or better terms for early signature.

4.4 Protected Rights

Nothing in this Agreement prohibits Employee from filing a charge with, communicating with, or participating in an investigation or proceeding conducted by a governmental agency, including the EEOC, NLRB, SEC, or Massachusetts Commission Against Discrimination. Nothing interferes with agency enforcement authority or requires waiver of a right that cannot lawfully be waived. Any effect of the release on individual monetary recovery is governed by applicable law.

5. COVENANTS & PROTECTED RIGHTS

5.1 Confidential Information

Employee shall protect legitimate trade secrets and non-public proprietary information. This Section does not restrict truthful testimony, protected communications, government reports, discussions of wages or working conditions protected by law, or other conduct protected by law.

5.2 Non-Disparagement

During [TIME PERIOD], neither Party shall knowingly make a false statement of fact intended to harm the other Party’s reputation. This Section does not restrict truthful statements, government communications, whistleblower reports, testimony, discussions of wages or working conditions protected by law, or other protected conduct.

5.3 Return of Property

Employee represents that all Company Property has been returned or will be returned no later than the Separation Date, including all originals and copies of confidential information.

Return of property does not delay final wages or other amounts already owed.

5.4 Restrictive Covenants

No prior restrictive covenant is automatically reaffirmed or incorporated by this Agreement. No new noncompetition covenant is included. Do not add one without Massachusetts counsel: Mass. Gen. Laws ch. 149, § 24L defines a separation-related noncompetition agreement outside the Act only if Employee is expressly given seven (7) business days to rescind acceptance. Identify any separately reviewed continuing covenant here: [________________________________].

6. REPRESENTATIONS

(a) Corporate Authority. Company represents that the undersigned signatory has full authority to bind Company.
(b) No Prior Assignment. Employee represents that Employee has not assigned or transferred any Claim released herein.
(c) Full Understanding. Employee represents that Employee (i) has read this Agreement carefully, (ii) understands its terms, and (iii) enters into it voluntarily.

Employee identifies any pending lawsuit, arbitration, charge, or complaint against a Released Party here: [________________________________]. This disclosure does not restrict protected agency communication or participation.

7. DEFAULT & REMEDIES

(a) Default. A Party is in default if it materially breaches this Agreement and fails to cure the breach within ten (10) days after receiving written notice, if cure is reasonably possible.

(b) Remedies. A Party may pursue lawful contract remedies for a proven material breach. No remedy creates a release-challenge penalty, requires repayment merely for filing or participating in an agency matter, restricts a protected communication, delays earned wages, or creates a prevailing-party fee shift.

8. RISK ALLOCATION

8.1 ADEA Waiver Challenges

Nothing imposes a condition precedent, penalty, attorney-fee liability, damages, or another limitation that adversely affects Employee’s right to challenge the validity of the ADEA waiver.

8.2 No Admission of Liability

This Agreement shall not be construed as an admission of liability by any Party. Each Party expressly denies any wrongdoing.

8.3 No Employee Risk-Shifting

This Agreement does not impose employee indemnity, a liability cap, a force-majeure excuse for payment, a severance clawback, or a penalty for a good-faith challenge to the release.

9. GOVERNING LAW & DISPUTE TERMS

(a) Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the Commonwealth of Massachusetts and applicable federal law, without regard to conflict-of-law principles.

(b) Forum. An action concerning this Agreement may be filed in a Massachusetts state or federal court with subject-matter and personal jurisdiction and proper venue.

(c) Arbitration. No arbitration clause is included. If selected, use a separately reviewed addendum addressing formation, costs, discovery, remedies, and governing law.

(d) Jury Trial. No predispute jury waiver is included in this template.

(e) Protected Rights. Nothing in this Section restricts agency access, protected communications, or claims and remedies that cannot be waived privately.

10. GENERAL PROVISIONS

10.1 Amendment & Waiver. No amendment or waiver of this Agreement shall be effective unless in writing and signed by both Parties. A waiver of any term shall not be construed as a waiver of any other term.

10.2 Assignment. Employee may not assign or delegate any rights or obligations under this Agreement. Company may assign this Agreement to any successor in interest.

10.3 Severability. If any provision is held unenforceable, it shall be deemed modified to the minimum extent necessary to render it enforceable, and the remaining provisions shall remain in full force.

10.4 Entire Agreement. This Agreement constitutes the entire understanding between the Parties and supersedes all prior agreements concerning the subject matter hereof.

10.5 Counterparts; Electronic Signatures. This Agreement may be executed in counterparts, each of which shall be deemed an original. Signatures transmitted electronically or by facsimile shall be deemed original signatures.

11. EXECUTION BLOCK

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Execution Date.

COMPANY
By: _______________________________
Name: [AUTHORIZED SIGNATORY]
Title: [TITLE]
Date: _____________________________

EMPLOYEE
Signature: _________________________
Name: [EMPLOYEE FULL NAME]
Date: _____________________________

Sources and References

• 29 U.S.C. § 626(f)
• 29 C.F.R. § 1625.22
• 29 U.S.C. § 157
• McLaren Macomb, 372 NLRB No. 58
• Mass. Gen. Laws ch. 149, § 148
• Mass. Gen. Laws ch. 149, § 150
• Mass. Gen. Laws ch. 149, § 24L
• Mass. Gen. Laws ch. 151B, § 4
• Massachusetts Attorney General Advisory 99/1