Should You Sign a Severance Agreement in California? Read This First
The paperwork usually arrives at the worst possible moment. You have just been told your job is ending, someone slides a The paperwork usually arrives at the worst possible moment. You have just been told your job is ending, someone slides a document across the table or emails it to you for e-signature, and the number near the top looks like relief. Then you notice the signature deadline. If you are holding a severance agreement right now and feeling rushed, that feeling is not an accident. California law gives you more room than the person who handed you the document may have mentioned.
Labor Law PC only represents employees. Our offices are in Santa Monica and Palo Alto, and we work with employees across California. Sometimes we read an agreement and tell people the offer is fair and they should take it. That is a real answer we give, and it costs nothing to hear.
What Rights Do You Give Up by Signing a Severance Agreement?
A severance agreement is a purchase. The money is the price, and what the employer is buying is your right to bring claims: discrimination and harassment under California’s Fair Employment and Housing Act, retaliation, wrongful termination, and unpaid wages, overtime, breaks and business expenses.
Most agreements go further than the claims you know about. Under Civil Code section 1542, a general release does not by itself reach claims you do not know or suspect exist, so employers add an express waiver of that section. That is how a short document ends up releasing things you have not yet discovered. If nobody has looked at your personnel file, your pay records, or the timing of your termination, you are being asked to sell something without knowing what it is worth.
How Long Do You Have to Sign a Severance Agreement in California?
In California, you usually have at least five business days to have a severance agreement reviewed, and if you’re 40 or older, often 21 or 45. If you are 40 or older, federal law sets minimum periods before you can validly release a federal age discrimination claim: at least 21 days to consider it, or at least 45 days if your termination was part of a group layoff. Those run from the employer’s final offer, not the first version you saw.
If the agreement releases a federal age claim, you also have 7 days after signing to revoke, and it does not become enforceable until that week has run. You can sign early. You cannot shorten the 7 days, and neither can your employer.
In a group layoff the employer must also give you the job titles and ages of everyone selected, and the ages of everyone in the same unit who was not. Individual ages, not ranges. That disclosure is often where an age case begins, because it is the first time you see the pattern.
If you are any age. Under Government Code section 12964.5, an employer offering a separation agreement must tell you that you have the right to consult an attorney and give you at least five business days to do it. Five business days is not much, but it’s still enough time to have a lawyer read it before you commit.
What a Severance Agreement Can’t Legally Take Away in California
- Silence you about unlawful conduct. A non-disparagement or confidentiality clause must carve out your right to discuss unlawful acts in the workplace. The severance amount itself can stay confidential.
- Buy back wages the employer concedes it owes. Under Labor Code section 206.5, no release of a claim for wages due can be required unless those wages have been paid.
- Stop you saying what you were paid, or what it was like to work there. Labor Code sections 232 and 232.5. Genuine trade secrets are separate.
- Dispose of a workers’ compensation claim without the appeals board approving it.
- Waive your unemployment benefits. Be careful though: payments labeled wages in lieu of notice or salary continuation are treated differently and can delay benefits.
- Stop you filing with a government agency. Your right to file a charge with the EEOC, the Civil Rights Department, or the Labor Commissioner survives the release.
Signs Your Severance Agreement Deserves a Closer Look
- The deadline is shorter than the periods above
- You are 40 or older and it says nothing about 21, 45 or 7 days
- It arrived right after you reported something, requested leave, or disclosed a pregnancy or medical diagnosis
- It omits earned commissions, accrued vacation, or an unpaid bonus
- You were told the number is standard, final, or non-negotiable
- Nobody mentioned your right to consult an attorney
None of these means the agreement is unlawful. Every one of them means it is worth reading properly before it becomes permanent.
Do I have to sign a severance agreement by the deadline in California?
You shouldn’t assume the deadline you were given is the one the law requires. When a California employer offers a separation agreement, it must give you at least five business days to have it reviewed by an attorney, and it must tell you that you have that right. If your deadline is shorter than that, or no one mentioned your right to consult a lawyer, that’s a sign the agreement was written to move faster than the law allows. Ask for the full time in writing. A reasonable employer will give it, because they want a release that holds up.
Can I still cancel a severance agreement after I signed it?
Sometimes. If you’re 40 or older and it releases a federal age claim, you have seven days after signing to revoke and no employer can shorten that. After that window closes you usually can’t cancel the whole agreement, but individual clauses can still be unenforceable under California law. If you signed recently, have it reviewed before assuming you’re stuck.
Will negotiating my severance make the employer withdraw the offer?
It happens, but it is not the norm. Employers offer severance because they want the release, and pulling it costs them the release.
Do Not Sign Under a Clock Someone Else Set
You are allowed to take the time the law gives you. If a severance agreement is in front of you, call (877) 775-2267 or contact us online for a free, confidential review. No fees unless we win.
This article is general information about California law as of September 2026 and is not legal advice about your situation. Reading it does not create an attorney-client relationship. Deadlines in employment matters are short and vary by claim.
