What Makes a Severance Agreement Unfair or Unenforceable?

 Posted on June 25, 2026 in Employment Law

A severance agreement can be unfair or unenforceable when it violates federal or state law, was signed under pressure without enough time to review it, or fails to meet specific legal requirements. Many people sign these agreements without fully understanding what they are giving up. By the time they realize the terms were not in their favor, it may be too late to do anything about it. If you have been offered a severance agreement in 2026 or already signed one and have concerns, a Fairfax, VA employment law attorney can review it and tell you where you stand.

What Legal Requirements Must a Severance Agreement Meet to Be Valid?

One of the most important sets of requirements applies to employees who are 40 or older. Under 29 U.S.C. Section 626, employers must follow specific rules before an older worker can give up their right to sue for age discrimination. These rules include:

• Giving the employee at least 21 days to review and consider the agreement before signing

• Providing a seven-day window after signing, during which the employee can change their mind and revoke the agreement

• Including a written advisement that the employee should consult an attorney before signing

• Making the waiver written in plain language that the employee can understand

• Specifically referencing the Age Discrimination in Employment Act in the agreement

• Not requiring the employee to waive rights or claims that arise after the date the agreement is signed

• Providing something of value beyond what the employee is already entitled to, such as additional pay or benefits, in exchange for the waiver

If the employer is offering severance to a group of employees at the same time, such as during a layoff, the review period stretches to 45 days. The employer must also provide a written list of the job titles and ages of all employees offered severance and those not offered severance in the same group. Failing to meet any of these requirements can make the waiver of age discrimination claims unenforceable, even after the employee has already signed.

What Makes a Severance Agreement Unconscionable Under the Law?

Unconscionability is a legal term that means a contract is so one-sided that it would be unfair to enforce it. A severance agreement may be challenged on this basis if the terms are extremely one-sided in the employer's favor. It may also be challenged if you had no real opportunity to negotiate the terms. Another issue is whether you understood what you were agreeing to when you signed the agreement. An employer's use of deceptive or misleading tactics to obtain your signature may also be grounds to challenge the agreement.

Can You Challenge a Severance Agreement You Signed Under Pressure?

Signing under duress or undue pressure can affect whether the agreement holds up. Situations that may support this kind of challenge can take many forms. For example, your employer may have told you that you had to sign immediately or lose all benefits. You may also have been threatened with a negative job reference if you refused to sign. In some cases, an employer may provide false information about what would happen if you declined the agreement. Pressure to sign immediately after a sudden and stressful termination may also support this type of claim.

If any of these apply to your situation, an attorney can evaluate whether the circumstances affect the enforceability of the agreement.

Can a Non-Compete Clause in a Severance Agreement Be Challenged in Virginia?

Non-compete clauses are one of the most commonly challenged parts of severance agreements. Virginia does enforce them, but only when they are reasonable in scope, length, and geographic area. Under Virginia Code Section 40.1-28.7:8, non-compete agreements for certain lower-wage workers cannot be enforced at all.

Even for higher-earning employees, a non-compete that is too broad in its scope, duration, or geographic reach may be found unenforceable by a court. *If the non-compete in your agreement would stop you from working in your field entirely, that is worth discussing with an attorney.

Contact Our Alexandria, VA Severance Agreement Lawyer Today

Our Fairfax, VA employment law attorney is rated one of the best employment lawyers in the area and represents clients in both federal and state courts. He stays closely involved in every case, is easy to reach, and brings real support along with an aggressive approach when the situation calls for it. Contact Freedman Law, LLC at 410-290-6232 to talk about your case and find out how we can help. We’re available 24/7.