Laid off in California - am I entitled to severance?

Got laid off yesterday from my marketing role at a tech startup in San Francisco. Been there 3 years, no warning, just "position eliminated due to restructuring."

They're offering me 2 weeks severance in exchange for signing a release. My friend said California requires severance pay and I should negotiate for more. Is that true?

I'm at-will, no employment contract. Salary was $95K.

Sorry to hear about the layoff. Short answer: California does NOT legally require severance pay.

Your friend is mistaken. In California (and most states), employers have no legal obligation to provide severance unless:

• You have an employment contract that promises it
• Company policy/handbook creates an enforceable obligation
• There's a union agreement requiring it

Since you're at-will with no contract, the 2 weeks they're offering is voluntary on their part.

Former HR here. Two weeks for 3 years is pretty low. Standard I've seen at tech companies is 1-2 weeks per year of service, so you'd be looking at 3-6 weeks.

The fact they want a release means they're trying to protect themselves from potential claims. That release has value to them - use it as leverage.

Thanks @LisaT_Employment. So if severance isn't required, what AM I entitled to? They gave me my last paycheck yesterday but I have like 80 hours of unused vacation.

Critical question - good catch. California Labor Code Section 227.3 requires employers to pay out ALL accrued, unused vacation time at termination. This is considered earned wages.

With 80 hours at $95K salary, that's roughly $3,654 they owe you (80 hrs × $45.67/hr). This must be paid on your final paycheck or within 72 hours if they didn't give notice.

This is NOT severance - it's wages you already earned. Do not sign any release until you confirm this is paid separately.

I negotiated my severance last year in similar situation (SF startup, laid off after 4 years). Started with 2 weeks offer, negotiated to 8 weeks plus 3 months continued health insurance.

My approach: politely pushed back via email saying I'd like to discuss the package before signing anything. Then outlined my tenure, contributions, and asked for 12 weeks. We met in the middle.

Worst they can say is no. The initial offer is usually just their opening position.

Before you negotiate severance, check if you have any potential claims that would make the release more valuable to the employer:

• Were you paid correctly for all hours worked (exempt vs non-exempt classification)?
• Any unpaid overtime, missed meal/rest breaks?
• Were you subjected to discrimination, harassment, or retaliation?
• Any wage statement violations?
• Did they fail to reimburse business expenses (phone, mileage, etc.)?

If you have legitimate claims, the release is worth MORE to them and you have significantly more leverage. Many employment attorneys offer free consultations for situations like this.

Actually yes - I was classified as exempt but honestly worked way more than 40 hrs/week and my role was pretty much pure execution, not managerial. Also they never reimbursed my home internet even though I was remote 3 days/week.

Should I mention this in negotiating or talk to a lawyer first?

Talk to an employment lawyer FIRST. Do not mention specific claims to your employer yet.

Misclassification is a big deal in California. If you were improperly classified as exempt, you could be entitled to overtime pay, meal/rest break premiums, and penalties going back 3-4 years. We're potentially talking tens of thousands of dollars.

The release they're asking you to sign likely waives ALL claims including these. You need to understand what you're giving up before you sign anything.

Find an employment attorney who works on contingency - they only get paid if you recover money.

Agreed with @RobK_Law. Also, California has specific requirements for severance agreements:

• If they're asking you to release age discrimination claims, you must get at least 21 days to consider (45 days if group layoff) and 7 days to revoke after signing
• The release must be written in plain language
• They should advise you in writing to consult an attorney

Don't let them pressure you to sign immediately. Take your time, consult counsel, and negotiate. You have leverage here.

Update: talked to an employment attorney this morning (free consult). She confirmed the misclassification issue is real and said my role definitely sounds non-exempt based on job duties.

She's going to send a letter to my employer outlining potential claims and suggesting we negotiate enhanced severance in exchange for release. Sounds like I should end up with way more than 2 weeks.

Thanks everyone for the wake-up call. I was about to just sign and move on.

For anyone else in this situation: also check your employee handbook. Some companies have unofficial "standard severance" policies they follow even though they're not legally required.

At my company we had a reduction in force and everyone got severance based on tenure even though handbook didn't promise it - they just wanted to avoid bad PR and keep morale up for remaining employees.

Just got laid off from a similar situation (3.5 years at a San Jose tech company) and this thread has been incredibly helpful. Following OP's approach and consulting with an employment attorney before signing anything.

One question: the severance agreement they gave me has a non-disparagement clause that seems really broad - basically says I can't say anything negative about the company ever. Is that enforceable in California? Seems like it would prevent me from leaving honest Glassdoor reviews or warning others about the toxic work environment.

Attorney said it might run afoul of California's anti-SLAPP laws but I'd love to hear if anyone else has dealt with this.