Severance Agreements in California: What to Review Before You Sign
Most severance offers are first offers. Here is how California law limits what an employer can ask you to give up, and where the real negotiating room usually sits.
By Ingrid Rainey · January 13, 2026 · 9 min read
Updated June 18, 2026

California pregnancy leave confuses employers because two statutes with different eligibility rules run in sequence. Pregnancy Disability Leave applies to employers with five or more employees, from the first day of employment, for up to four months of actual disability. California Family Rights Act bonding leave applies to employers with five or more employees for employees with twelve months and 1,250 hours of service, and provides twelve additional weeks that begin after the disability ends. Treating them as one entitlement is the mistake that produces interference and retaliation claims.
PDL is available whenever an employee is actually disabled by pregnancy, childbirth, or a related condition — including severe morning sickness, prenatal care, bed rest, and recovery from delivery. It need not be taken in one block; intermittent and reduced-schedule leave are permitted when medically advisable.
Four months means the equivalent of the hours the employee would work in four months, prorated for part-time schedules. The employer may require medical certification but cannot demand a diagnosis beyond what the certification form allows.
Once the pregnancy disability ends, an eligible employee may take up to twelve workweeks of CFRA bonding leave within one year of the child's birth. In practice, an employee with a complicated pregnancy can be out substantially longer than twelve weeks in total, and that is lawful.
CFRA also covers the non-birthing parent. Two employees of the same employer are each entitled to their own twelve weeks for bonding.
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Request a consultationLeave itself is unpaid, but employees typically receive State Disability Insurance during the disability period and Paid Family Leave during bonding. Employers must maintain group health coverage on the same terms during PDL and again during CFRA leave.
On return, the employee is entitled to the same position. The narrow exceptions — the position ceased to exist for legitimate business reasons unrelated to the leave — are proven by the employer, and contemporaneous documentation is what makes that proof credible.
PDL applies at five or more employees, and CFRA now also applies at five or more employees. Very small employers still have accommodation and antidiscrimination obligations.
Yes, medical certification of the disability and expected duration may be required, using the standard certification. Broader medical inquiries are not permitted.
The employee is entitled to reinstatement to the same position, with narrow exceptions the employer must prove. A comparable position may satisfy CFRA in limited circumstances.
A layoff is lawful only if it would have occurred regardless of the leave. That requires documented selection criteria applied to everyone, created before the leave decision.
This article is general information, not legal advice, and does not create an attorney-client relationship. Outcomes depend on the facts of each matter.
Most severance offers are first offers. Here is how California law limits what an employer can ask you to give up, and where the real negotiating room usually sits.
California does not merely refuse to enforce non-competes — it makes including or enforcing one a violation in its own right, with attorney's fees for the employee.
At-will means an employer can fire you for a good reason, a bad reason, or no reason — but not for an unlawful reason. The case turns on which one it was.
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