Analyze the terms of a separation agreement and research the labor laws in your state. The company will first prepare an agreement for the defense of its interests. Be sure to sign something that also protects your rights. Keep in mind that an employee separation agreement is a legal document that establishes an agreement between a company and a terminated employee. After the signature of both parties, the dismissed employee waives his right to take legal action against the company in the future (i.e. to bring an action for an injunction or severance pay). The agreed terms supersede all other agreements between the two parties. If the company offers wages and other payments, the agreement must state the exact amount and nature of the compensation. Payment can be a lump sum or a structured plan.