A bill that would give terminated employees in New York more time to review severance agreements and limit employers’ ability to pressure employees into quickly signing such agreements just passed both houses of the New York Legislature. After failing to advance last year, the No Severance Ultimatums Act how heads to Governor Hochul’s desk after passing both houses on June 1. If she signs it, the law would take effect immediately, potentially requiring employers to revise their severance practices on very short notice. As employers await Governor Hochul’s decision, here are the bill’s key provisions and practical steps employers may wish to consider now.

What Would the Bill Require?

If enacted, the bill would apply to separation agreements that require employees to release legal claims against their employer. Employers offering current or former employees severance agreements would be required to inform them of:

• Their right to speak with an attorney before signing;
• A minimum 21-calendar-day period to consider the agreement;
• A seven-calendar day period to revoke the agreement after signing; and
• The fact that the agreement will not become effective or enforceable until the seven-day revocation period ends.

The bill would still let an employee sign before the 21-day review period ends, but the employee’s choice to sign early must be voluntary. Employers could not induce an employee to sign early through fraud, misrepresentation, threats, or by offering more favorable...

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