Many employers that need to cut the workforce will make a determination to offer certain employees severance in exchange for leaving without filing a lawsuit. Responding to a discrimination lawsuit, even the most minor one that has no merit, can cost an employer several thousand dollars in attorney’s fees and time spent to respond to the suit. Employees who are minorities, those over the age of 40, and those with disabilities are often the ones the employer is most concerned about because they have an undeniable reason to charge the employer with discrimination.
Avoiding the expense of litigation is not the only reason that employers will offer severance, though. Many employers offer severance to employees who have worked at the company for a long time, those who were considered valuable employees, and those who need a financial bridge before retirement.
Being offered a severance agreement is a great benefit and should be viewed positively, rather than wondering why one employee got it instead of another. Employers have no legal obligation to inform an employee why he or she was selected to receive a severance offer.