Before You Sign a Severance Agreement: What Wrongful Termination Lawyers in Dallas Check First

Severance agreements are drafted by the company’s lawyers, and every clause in one exists to protect the company. That does not make them a trap, but it does mean the document is not neutral. Wrongful termination lawyers in Dallas see the same pattern repeatedly: a worker with a real discrimination or retaliation claim signs a general release for eight weeks of pay, then learns months later that the claim was worth considerably more. The deadline pressure is deliberate. Understanding what you are actually trading away is the difference between a reasonable settlement and a giveaway.

What am I giving up when I sign a severance release?

A general release waives every legal claim you have against the employer as of the day you sign, whether or not you knew the claim existed.

That includes discrimination, retaliation, harassment, unpaid wages, and breach of contract. Read the definition of released parties, which usually extends to individual supervisors, parent companies, and board members. Some claims cannot be waived at all, including workers’ compensation rights, vested retirement benefits under ERISA, and future claims for conduct that has not happened yet.

Look closely at what the company calls consideration, meaning the value you receive in exchange for the release. Payment for wages, commissions, or accrued vacation you were already owed under company policy is not new consideration. If the entire offer consists of money the employer had to pay anyway, the release may be unsupported.

Can a severance agreement stop me from filing an EEOC charge?

No. The right to file a charge with the Equal Employment Opportunity Commission cannot be waived, and the Fifth Circuit said so directly in EEOC v. Cosmair. Any clause claiming otherwise is unenforceable on public policy grounds.

The distinction that matters is between filing and recovering. You can still file a charge, cooperate with an investigation, and respond to an agency subpoena after signing. What a valid release does take away is your ability to collect money for yourself from that charge or a related lawsuit. Agreements drafted well after Cosmair usually carve this out explicitly. Agreements that flatly prohibit contact with the EEOC are a signal about how carefully the rest of the document was written.

What protections apply if I am 40 or older?

The Older Workers Benefit Protection Act imposes specific requirements before an age discrimination claim can be waived, and an agreement that misses any of them fails to waive the ADEA claim.

• At least 21 days to consider the agreement, or 45 days if severance is offered to a group as part of a layoff or exit incentive program
• 7 days to revoke after signing, during which the agreement is not effective
• Written advice to consult an attorney
• Specific reference to rights under the Age Discrimination in Employment Act
• For group terminations, a written disclosure listing the job titles and ages of everyone selected and not selected within the decisional unit

That last attachment is often the most useful document in the packet. It shows, in the company’s own numbers, whether older workers were selected at a higher rate. People routinely sign without reading it.

Material changes to the offer restart the consideration period. And under the Supreme Court’s decision in Oubre v. Entergy Operations, a worker who signs a release that fails OWBPA does not have to return the severance money before bringing an ADEA claim.

Which clauses do wrongful termination lawyers in Dallas flag most often?

Non-competes and clawbacks, because both keep operating long after the money is spent.

Severance agreements frequently introduce a noncompete that never existed in your employment contract, or broaden one that did. In Texas, a covenant not to compete must be ancillary to an otherwise enforceable agreement and reasonable in time, geographic area, and scope of activity under Section 15.50 of the Business and Commerce Code. The FTC’s attempted nationwide ban was set aside by a federal court in Texas in 2024, so state law controls.

A clawback or liquidated damages clause requires you to repay severance if you breach any term, which can include a casual comment about your former employer. Cooperation clauses obligate you to assist the company in future litigation, sometimes without any provision for compensating your time. No-rehire clauses can quietly bar you from every subsidiary of a large employer.

Confidentiality and non-disparagement terms have their own limits. The Speak Out Act, signed in December 2022, makes pre-dispute nondisclosure and non-disparagement clauses unenforceable in sexual assault and sexual harassment disputes, though it does not reach agreements resolving a dispute that already exists.

How much time do I really have to decide?

Less than the agreement suggests, because your filing deadlines run whether or not you have signed anything.

You have 180 days to file a complaint with the Texas Workforce Commission Civil Rights Division under Chapter 21 of the Texas Labor Code, and 300 days to file a charge with the EEOC, measured from the day you were notified of the termination. A 21-day review period consumes a meaningful piece of that window. Severance can also delay unemployment benefits depending on how the payment is characterized, which is worth confirming with the Texas Workforce Commission before you assume the two are unrelated.

The offer on your desk reflects what the company thinks it can settle for, not what your claim is worth. A review before the deadline costs far less than discovering after the revocation period closes that you signed away a viable case. The wrongful termination lawyers in Dallas at Mundaca Law can read the agreement, identify what you would be releasing, and tell you whether the number makes sense. Send it over while you still have days left on the clock.