How to Negotiate with Your Employer when You Get Laid Off

How to Negotiate with Your Employer when You Get Laid Off

How to Negotiate with Your Employer when You Get Laid Off

Life can change in an instant. After receiving the news that you’re getting laid off, it might feel like your entire world is coming to an end. A layoff can be brutal to endure, especially if you didn’t see it coming. What are you supposed to do now? Is it possible to pick up the pieces and move on to something better from here?

Dealing with a major shock is never easy. It’s natural to feel angry and worried after realizing you just lost your job. Nonetheless, it’s important to keep your head and avoid going into panic mode. Losing your job doesn’t necessarily leave you helpless. Now is the time to negotiate with your boss and get the benefits you deserve.

Come to Terms with Reality

Sometimes, bad things happen to good people. There are many reasons employers choose to lay people off. Maybe labor costs are too high, and long-term positions are going to those with seniority. Perhaps the company merged with another, and the new management team will be taking a different approach to staffing. It’s also possible that your performance simply wasn’t up to snuff.

None of these realities is easy to deal with, but if you can come to terms with the situation, you’ll be in a better position to negotiate a good severance deal. Do your best to avoid getting emotional. Don’t plead to keep your job or try to make an appeal about your financial burdens. Your boss likely already feels terrible about the situation. Maintain your dignity and avoid making the situation worse.

Look at Your Options

Most companies offer severance packages to help employees deal with layoffs. What’s in these packages can vary, and all elements of the package are almost always negotiable. Before you attempt to negotiate, review what your former employer is offering.

Severance Pay

Most layoff packages include some form of severance pay. Some companies provide the employee with six months of pay. This is only one of the possible benefits, and the exact amount is negotiable.

Remaining Sick Days and Vacation Time

After a layoff, some employers are willing to let you cash in your remaining vacation time and leftover sick days.

Medical Insurance

The possibility of losing your medical coverage is one of the most frightening aspects of a layoff. This is especially a problem if you or a dependent has health issues. But you have options. You should move quickly to make your decisions, because there are deadlines for applying.

  • COBRA. Many companies allow former employees to continue using the company medical plan for several months, under COBRA. COBRA can be expensive, but you can negotiate for the company to help cover your premiums or extend the coverage period while you look for a new job.

  • State marketplace. You can also enroll in your state's insurance marketplace, which can be much more affordable than COBRA. Depending on your income and the size of your family, you may be eligible for a subsidy to cover part of the costs.

  • Other options. Other common options you could look into are Medicaid, Medicare, and private insurance.

Stock Options

It’s standard procedure for a company to take back unvested stock options after an employee leaves the company. Nonetheless, it’s sometimes possible to negotiate how this process will work. For example, if you’re close to reaching a vesting point, your employer might be willing to end your employment on a later date. Some companies also offer special deals, such as accelerated option vesting.


Negotiations are about more than the details of your severance deal. You’ll also want to ask about references. A good reference from a former employer can go a long way in helping you find a new job.

Negotiate with Confidence

Once you've looked over the basics of your severance package, it’s wise to have the paperwork reviewed by a lawyer. If this isn’t possible, consider contacting an experienced colleague or anyone else who might be able to help.

After the review, spend some time going over your priorities. You can negotiate, but you most likely won’t get everything you want. Therefore, the best route forward is to head into the meeting with a good idea of what matters most.

When you’re ready, meet with your former boss to discuss the severance agreement. Be confident in yourself, and prepare to discuss the ways you’ve contributed to the company’s success. Don’t be boastful, and don’t rewrite history. Take an honest look at what you’ve accomplished, and find examples that demonstrate your value.

Keep Hope Alive for the Future

Getting laid off can be rough, and it may take some time to get used to the idea of moving on. Maintaining your confidence will be very important. If you know someone who's triumphed after their own layoff, try to get some perspective from them. In the meantime, do your best to negotiate an excellent deal, but also know that no matter what happens, you'll have other opportunities to start building a new future.

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