Mass Layoffs: What They Don’t Tell You About Group Severance Agreements

Laid off? It’s a moment no one expects. The job you relied on is suddenly gone. The income, the structure, the sense of normalcy. It all changes in an instant. 

Now, you’re left trying to understand a severance package filled with legal language, fine print, and deadlines. And while it’s tempting to just sign and move on, this is a contract that could affect your financial future.

If you’ve never worked with legal professionals before, this might be the right time to start. At Horn Wright, LLP, our business transaction lawyers work with New Yorkers who’ve been caught up in corporate restructurings, department cuts, and mass layoffs. 

We know how to examine every line of a severance agreement, clarify what’s fair (and what’s not), and help you walk away with confidence. If you’re being asked to waive your rights, you deserve to know exactly what you’re giving up and what you’re getting in return.

What the Law Says and What It Means for You

In New York, companies aren’t required to offer severance. But if they do, especially during layoffs, the agreement has to meet certain legal standards. If you're being asked to sign something in exchange for compensation, the law protects your ability to make an informed decision.

• Clear language: Severance agreements must be written in plain, understandable language. If the document is packed with confusing legal terms or lacks clarity, that’s a problem. You should never feel unsure about what you're signing, and unclear terms may even weaken the agreement’s enforceability.
• Voluntary consent: The decision to sign must be entirely yours. If you’re being pressured, rushed, or misled, that can affect the validity of the agreement. Employers are required to give you time to review and must avoid any form of coercion.
• Meaningful compensation: You’re giving up something important - typically your right to pursue legal claims. In return, the employer must offer something of real value, like additional pay, health coverage, or another benefit you weren’t already owed. If the severance simply repackages your final paycheck, it may not be a fair deal.

These aren’t just formalities. They’re your rights. When you're handed a severance agreement, treat it like any other binding contract. The kind of review commercial contract attorneys in New York would do can make all the difference.

What WARN Actually Requires in New York

You might assume that if a company is laying off a large number of employees, they’d be legally required to give advance notice. That’s exactly what the Worker Adjustment and Retraining Notification (WARN) Act is meant to ensure, but it comes with specific thresholds. It applies to private employers with 50 or more full-time employees and is stricter than the federal law.

If a layoff affects 25 or more workers and they make up at least 33% of the workforce, or if 250 or more are laid off regardless of size, the employer must give 90 days’ written notice. This notice must be sent not only to employees, but also to local government officials and the New York Department of Labor. 

Employers who fail to meet this requirement may be responsible for back pay and benefits for each day of the violation, under both state and federal WARN laws. If you weren’t notified in advance, and your employer qualifies under WARN, you could be entitled to compensation beyond your severance package. 

Layoffs planned as part of a broader restructuring or merger often involve consultation with business formation legal experts but workers are rarely informed until it’s too late. Understanding your rights can change how you respond to your layoff.

Mass Layoffs Aren’t Always Equal and You Can Push Back

Most severance offers during mass layoffs are standardized. They’re often presented as final. Same package, same language, same deadline for everyone. But not every situation is the same, and you may have more leverage than you realize.

• If your role was unique: Specialized knowledge, long-term client relationships, or proprietary access can give you negotiating power. Employers don’t want sensitive or high-value knowledge walking out the door upset. If that’s you, your severance might deserve a second look.
• If your situation raises legal concerns: Were you laid off after taking protected leave, reporting misconduct, or requesting accommodations? If so, you may have a potential legal claim under Title VII of the Civil Rights Act, the Americans with Disabilities Act, or Section 296 of the New York Executive Law. That alone could justify better terms.
• If money isn’t your only concern: You might also need Consolidated Omnibus Reconciliation Act of 1986 (COBRA) coverage assistance, outplacement services, a neutral reference agreement, or help with stock options. These non-monetary items can make a severance package significantly more useful, if you know to ask.

This type of strategic review isn’t just for executives or mergers and acquisitions lawyers in New York. It’s for any employee who wants to make the most of a difficult situation.

Group Layoffs vs. Individual Severance: What’s the Legal Difference?

How your employer structures the layoff affects what they must tell you and how much time you have to consider your options.

• Group layoffs require more disclosure: If you’re over 40 and part of a group layoff, your employer must provide written information about the ages and roles of everyone let go and retained. This lets you assess whether decisions were fairly made.
• You get more time to decide: In group layoffs, the Older Workers Benefit Protection Act (OWBPA) requires that you receive 45 days to review the severance agreement instead of the standard 21. That time matters when you're consulting legal counsel or weighing your options.
• Group agreements are often boilerplate: They tend to be written in broad terms for efficiency, but mistakes or unfair clauses can slip in. Don’t assume that just because everyone else signed, you should too.

These group severance arrangements are often drafted in coordination with corporate governance legal advice in New York. But that doesn’t mean they can’t be reviewed, questioned, or revised, especially when your financial stability is on the line.

How Employers Decide Who Stays and Why You’re Allowed to Ask

Employers don’t always explain why certain employees are laid off while others remain, but that doesn’t mean you aren’t entitled to know. 

In fact, if you’re over 40 and part of a group layoff, federal law requires your employer to provide written documentation that outlines how those decisions were made. That information can be crucial in spotting patterns that suggest bias or unequal treatment.

These disclosures are required under OWBPA, and they’re designed to protect workers from discriminatory layoffs masked as routine business decisions. It’s especially important in large companies where departments or “decisional units” are reorganized or dissolved entirely. If the reasons provided don’t align with your performance history or role, that may be worth investigating further. You're not just allowed to ask for this information. You're legally entitled to it.

This type of transparency matters even more during corporate transitions, like mergers or acquisitions. When layoffs occur as part of business sale and purchase agreements, workers are often affected with little explanation. 

But the law doesn’t let employers make these decisions in total silence. Knowing the selection process gives you a clearer picture of whether your severance package truly reflects fair treatment or whether there’s a deeper issue that needs attention.

We Help You Understand the Fine Print and Protect What’s Yours

When you’re laid off, time feels like it’s working against you. You're being asked to sign something that could impact your finances, your benefits, and your rights. And often, you’re expected to do it fast. 

At Horn Wright, LLP, we help workers across New York review and negotiate severance agreements with a sharp legal eye and a strong sense of fairness. Our team of employment and business transaction lawyers knows what to look for, what to challenge, and how to advocate for better outcomes. 

We’re proud to be recognized among the leading law firms in America, but even prouder of how we treat people, one agreement at a time. Let’s fight for your rights too. Contact our office today to schedule your complimentary case review.