Many large Fortune 500 companies offer employees a voluntary package of benefits for them to consider in lieu of continuing employment at the company. Perhaps the work force is being reduced, manufacturing or services are being outsourced, or the company is merging with the inevitable consequence of duplicate jobs.
A true “buy out” gives you the employee the option to take the money and (literally!) run or continue working. Each decision carries with it certain implications. Perhaps the most important is, assuming you want to continue working, how much longer your job remains post-buy out offer. One has to assume that the employee may still be laid off on an “at will” basis, at least in the absence of a contract. So, evne though you may wish to continue working, the company may be sending you a not-so-veiled message that job security is a thing of the past.
Also consider the “fine print”. Somel buy outs may attempt to limit your right to continue to work in the industry, for a competitor, supplier, or customer. In California (where we have our offices) employers may not limit employees from continuing to work in the same field, and any buy out that has this agreement made be unenforceable by the employer. This is not legal advise since we don’t give legal advise in this column and a complete answer would depend on reviewing the particular buy out agreement.
In many cases, employers are required by law or other contractual agreements to give certain benefits (COBRA conversion rights re health insurance), defined employer-contribution retirement plans, etc., and a buy out agreement should not require an employee to specifically agree within a buy out to benefits that are already owed that employee.
In many cases, a buy out can be specially negotiated. For example, a job placement agency who is already under retainer to the company could be added on. Health insurance could be paid for into the future. Don’t hesitate to ask for sweetners!