When you finished your residency and started practice in Hershey, you thought you had found the perfect hospital. As your practice developed, though, you began to look for different employment opportunities that better fit your interests. Now that you have found a new position, your current hospital administrator may want you to sign a severance agreement.
Severance agreements are common for high-wage earners, educated professionals and others in the workforce. Simply put, a severance agreement describes the obligations of you and your employer following the end of the employment relationship. Here are five things to consider before you sign one.
While many severance agreements offer some form of post-employment compensation, not all do. Be sure you carefully read through the agreement to understand how much you can expect. Also, make sure the agreement addresses your pension, stock options and other forms of compensation.
2. Non-compete provisions
Some severance agreements include non-compete clauses. If your agreement has one of these provisions, you may not be able to work as a doctor for another hospital in the area. Because non-compete clauses can be tricky, you may want to exercise your right to have an attorney review your severance agreement before you sign it.
As a medical doctor, you understand the importance of having adequate health insurance. If you have to rely on COBRA coverage, your current employer may pay premiums until the insurance at your new hospital starts. Either way, your severance agreement should address insurance coverage.
Your existing hospital may not want you to discuss your employment experience, compensation package, severance payments or other topics. If the severance agreement has a confidentiality provision, breaching it could render the contract invalid and land you inside a courtroom.
Finally, you may have some potential legal claims against your current employer. Before paying you a severance, the hospital administrator may ask you to release the hospital from liability.
While your severance agreement may help you transition from your current role to a different one in a new hospital, it may have some provisions that are not favorable to you. As with all contracts, you should understand the terms of your severance agreement before you sign it.