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What makes a severance negotiation successful?

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I recently concluded a severance negotiation for a client.  It went very smoothly and efficiently, with my employee client satisfied with the result.  He avoided wrongful dismissal litigation, and, after a lengthy employment relationship with his employer, he managed to leave on good terms.  Not every negotiation ends this way.  I don’t think that the results were an accident, and it is worth considering the elements that were present in this negotiation that led to a satisfactory resolution for both parties. Here are my thoughts:

1. A thoughtful client who knew what he wanted

My client was an absolute pleasure to deal with. Quite apart from there being good chemistry between us which, like any good personal relationship, helps in the professional one, he had given considerable thought to what he wanted, and how he wanted to get there. In his case, he had invested a large amount of his time and energy in this employer.  Notwithstanding the termination of his employment, he wanted to preserve as many of his professional relationships as possible. He felt that despite the unexpected turn in his employment, these were still people who could help him in the future.

This meant that while he wanted to negotiate the package upwards, he did not want to do so at any cost. He was familiar with the litigation process, having had family members litigate employment disputes, and he was certain that was not what he wanted. He thought that it would take too much time, too much money, and result in a truly severed relationship with his former employer. There was simply not enough of an upside when all the factors were considered. I agreed with his analysis.

2. The reasonable demand letter that got to the point

My client’s wishes were reflected in the tone of the letter I wrote to his former employer on his behalf.  While it set out what we considered to be the shortcomings in their initial offer, it did so while communicating an interest in resolving the matter. I read many a demand letter on behalf of our employer clients and I know the ones that lose me are either too long or over the top in terms of their demands. Not every termination is deserving of moral damages, although it seems that almost every demand letter I review has a claim for them.  My client’s termination was handled professionally and that is something that was acknowledged in the demand letter.  I hoped that my reasonableness would be met with reasonableness on the other side. In my view, reasonableness is not a sign of weakness, nor is it a sign of a wishy washy advocate. Rather, I think it is your best bet if you are trying to resolve things short of litigation.  It’s also your best bet if you would like to practice law for a long time, but that is another blog….

Similarly, I have always been of the view that brevity is an employment lawyer’s friend.  If you can say it in 100 words instead of 200, opposing counsel will thank you for it.  You don’t want someone to read your letter and at page 2, sigh, “get on with it”.

Suffice it to say, my letter was short and to the point.

3. A thoughtful opposing counsel who responded in kind

Sending a demand letter to an employer who is unknown to me has always been an interesting exercise. You simply cannot predict who or what you are going to get in response. Sometimes, you are extremely lucky and you have a reply from a lawyer you know, and with whom you have worked before. This always makes negotiating easier, as there is a pre-existing relationship. Sometimes you get a short email, which is the legal equivalent of “go jump in a lake”. Those are obviously more difficult to deal with.

In some cases, you hit the jackpot, as was the case here.  While I did not know opposing counsel, I knew of and respected her firm.  They are good employment lawyers.  I’d like to believe that she felt the same when she saw my name on the demand letter. In any event, she did something very smart. Instead of writing me a letter, she picked up the phone and called me. This was great as we quickly established a rapport, and it allowed me to learn first hand that her client shared the same interest as mine: that is resolving matters between them.

As we discussed the matter over several phone calls, we had differences of opinion to be sure.  However, we were able to sort them out quickly and efficiently.

Picking up the phone and speaking to the lawyer on the other side may sound as obvious as being reasonable. However, I am stunned by the sheer volume and the frequency of negotiations that are handled solely through email.

In addition, counsel was honest with me throughout our conversations. When she anticipated there would be a problem with her client accepting something that my client wanted, she told me so. She also told me where she thought she could get her client to move. I trusted her, and I hope that that was reciprocated as she dealt with me.

4. Keeping my client in the loop

Even after all these years of practicing, when I conduct a severance negotiation, I try and remember how I would feel if I were the client. I know that I would want to know what was going on throughout the negotiation, and I would want to know if there were any delays even if they were inconsequential. If I hadn’t heard from my lawyer in a few days, I know I would be at the edge of my seat, and so I would want a bit of a check in.

I tried very hard to keep my client in the loop as we were dealing with his matter. If a few days went by with nothing to report, I still sent him an email, or suggested some “homework” he could do while he was waiting. This included writing a draft letter of reference and sourcing the right outplacement counselor.

5. Clearly communicate any obstacles and options to get beyond them

There was one obstacle in this negotiation and it had to do with how to handle mitigation income.  This was the only time where it seemed like there was no middle ground. The lawyer on the other side had presented a scenario that correctly mirrored the law; that is her client wanted a dollar for dollar credit of everything my client earned over the notice period. Her client, she told me, would not be satisfied with anything less, particularly because they thought the departing employee would find another job quickly. My client wanted to keep his post-termination activities private, and didn’t like the idea of “reporting in”. He also was not as optimistic about the availability of another job as his former employer. I understood his point of view, but in this case, I urged him to reconsider his position as I did think it was an obstacle to getting to where he wanted to go. We reviewed the available options – which were to repeat the demand, which I didn’t think would get us anywhere given how forthcoming opposing counsel had been in describing her client’s interest on this point – or commence litigation – which I reminded my client that he had told me he did not want to do.

Sometimes in a negotiation you need to know when to bend and that it what my client did on this point.  I am always impressed by clients who are mature enough to do this. This was my client here.

People find it hard to believe when I tell them that after 20-plus years of lawyering, I still love my job. Negotiations like this one, with a superb client, and a thoughtful and effective opposing counsel, are one reason.

Janice Rubin