Severance Agreements in Utah: What to Know Before You Sign

Short answer: Utah law doesn't require an employer to offer severance pay at all — it's a matter of company policy or individual negotiation, not a legal entitlement. But if you're offered a severance agreement and you're 40 or older, federal law (the Older Workers Benefit Protection Act) gives you specific, legally required protections before you can validly waive an age discrimination claim as part of it — including at least 21 days to consider the offer (45 days for a group layoff) and 7 days to revoke your signature after signing, neither of which your employer can shorten or waive.

Who this guide is for

Utah employees who've been offered a severance agreement, or who are negotiating an exit from a job, and want to understand what they're actually agreeing to before signing.

Severance isn't legally required in Utah

Unlike final paycheck timing (see Utah Final Paycheck Law: When You Must Be Paid After Leaving a Job, which is legally required), severance pay itself is discretionary — an employer can offer it, decline to offer it, or negotiate case by case, without violating Utah law either way.

What a severance agreement typically asks you to give up

Most severance agreements include a release of claims — you agree not to sue the employer over your employment or its termination, in exchange for the severance payment. This commonly includes waiving potential claims for things like discrimination, wrongful termination, or wage disputes, though it generally can't waive certain rights that aren't legally waivable this way (like a right to file an unemployment claim, or in some cases, rights that arise after you sign).

If you're 40 or older: the OWBPA's specific protections

Federal law treats a waiver of age discrimination claims differently, requiring it to be "knowing and voluntary" under the Older Workers Benefit Protection Act (OWBPA), which specifically requires:

• At least 21 days to consider the agreement (or 45 days if it's part of a group layoff or exit-incentive program covering multiple employees)
• At least 7 days to revoke your signature after signing — a period that legally cannot be shortened or waived, no matter what the agreement says
• The agreement can't require you to waive claims arising after you sign it
• The agreement can't overstate the benefits you're getting or understate what you're giving up

If any of these specific requirements isn't met, the waiver of your age discrimination claim specifically can be invalid — even if you already signed.

What to actually check before signing

• Does it clearly describe what you're receiving, and on what timeline?
• Does it include a non-compete or non-disparagement clause you weren't expecting? See Non-Compete Agreements and Getting Fired in Utah: What Changes for how a fresh non-compete signed as part of severance is treated differently than one signed at hiring.
• If you're 40 or older, have you actually been given the full 21 (or 45) days, and does the agreement correctly describe your 7-day revocation right?
• Does it release claims you'd genuinely want to preserve — this is exactly the kind of judgment call worth an attorney's review before signing, not after.

Frequently asked questions

Can I negotiate the terms of a severance offer, or is it take-it-or-leave-it? Severance terms are often genuinely negotiable, particularly around the amount, the release's scope, and any post-employment restrictions — it's worth asking rather than assuming the first offer is final.

What happens if I don't sign the severance agreement? Generally, you keep whatever you're independently entitled to (like a properly timed final paycheck) but don't receive the additional severance payment — declining doesn't affect your legally required final wages.

Once I sign and the revocation period ends, can I still challenge the agreement later? Generally, a properly executed release is difficult to undo after the revocation period — which is exactly why reviewing it carefully (and, for the 40-and-older protections, using the full time you're legally given) matters before you sign, not after.