What happens to my stock options when I'm laid off from a tech company?

Vested stock options are yours but typically must be exercised within 90 days of termination. Unvested options are forfeited unless you negotiate accelerated vesting. The 90-day exercise window is negotiable, and extending it is one of the most important things you can do in tech severance.

Are non-competes enforceable for tech workers in California?

No. Non-compete clauses are void under California Business and Professions Code Section 16600. AB 1076 made it explicitly illegal for employers to include them. If your tech severance agreement has a non-compete, demand its removal.

How much severance do LA tech companies typically offer?

It varies by company size and stage. Large public tech companies typically offer 2-4 months plus equity treatment. Mid-stage startups offer 1-3 months. Early-stage startups may offer less cash but have more flexibility on equity terms. These are starting points that can often be increased through negotiation.

Tech Layoffs in LA: What to Know About Your Severance Package

If you're part of the ongoing wave of tech layoffs in Los Angeles, you're in a very specific situation that most general severance advice doesn't address. Tech severance involves equity, IP assignments, non-competes drafted by out-of-state legal teams, and compensation structures that don't fit neatly into standard formulas. Here's what matters for you.

Your Equity Is the Biggest Issue

In tech, equity is often the largest component of your total compensation. When you're laid off, what happens to your stock options and RSUs can dwarf the cash severance in terms of financial impact.

Vested stock options. These are yours. But you typically have only 90 days after termination to exercise them. If you can't come up with the exercise cost (strike price times number of shares, plus the tax hit), your vested options expire. Negotiate for a longer exercise window: 6 months, 12 months, or longer.

Unvested equity. You lose this when you're terminated unless you negotiate for accelerated vesting. Partial acceleration (an extra 6 to 12 months) is a common and reasonable ask. Full acceleration is rare except for executives or in change-of-control situations.

RSUs at public companies. If you have RSUs at a publicly traded company, unvested RSUs disappear at termination. Vested RSUs that haven't settled yet should settle according to the plan terms. Make sure the severance agreement doesn't interfere with this.

Startup equity. For employees at private LA tech companies, equity is even more complicated. You might be holding options that you can't sell, with a strike price that might be above current fair market value. You need to understand the company's latest 409A valuation before making exercise decisions.

California Kills Your Non-Compete

Many tech companies, especially those headquartered outside California or with legal teams in states where non-competes are enforceable, include non-compete clauses in severance agreements they hand to Los Angeles employees. Under California Business and Professions Code Section 16600, these are void. AB 1076 made it explicitly illegal for employers to even include them.

If your agreement has a non-compete, demand its removal. Don't accept "well, it's in there but it's unenforceable" as an answer. Having it in a signed document can still scare future employers, particularly if they're outside California.

IP and Invention Assignments

Tech severance agreements often include intellectual property provisions. Watch for:

Overly broad IP assignments. The agreement may try to claim ownership of anything you create after leaving, not just work you did during your employment. Under California Labor Code Section 2870, your employer generally cannot claim ownership of inventions you create on your own time using your own resources.

Confirmation of prior IP assignment. The agreement may ask you to reconfirm an IP assignment from your employment agreement. Read it carefully to make sure it doesn't expand the original scope.

The WARN Act in Tech Layoffs

Large-scale tech layoffs frequently trigger WARN Act requirements. If 50 or more employees were laid off at your site within a 30-day period and you received less than 60 days' notice, you may be entitled to up to 60 days of additional pay and benefits on top of your severance.

Tech companies sometimes try to stagger layoffs or spread them across offices to avoid triggering WARN. But California's version applies to employers with 75+ employees and doesn't require the percentage threshold that federal law does. If you think the numbers might add up, it's worth investigating.

Severance Benchmarks in LA Tech

Tech severance tends to be more generous than other industries, but it varies widely:

Large public companies: 2 to 4 months base salary plus equity treatment. Mid-stage startups: 1 to 3 months, often with limited equity flexibility. Early-stage startups: Minimal cash, but potentially more room to negotiate equity terms.

These are starting points. Your individual leverage depends on your role, your potential legal claims, and how the company is handling the layoff overall.

Don't Sign the Standard Package

Tech companies process layoffs at scale, and the severance agreements they send to LA employees are often one-size-fits-all. But your situation isn't one-size-fits-all. Your equity, your potential claims, your IP contributions, and your California-specific rights all make your package worth a closer look.

If you were laid off from a tech company in LA, our employment attorneys can review your severance package. Free consultation. We understand the equity, IP, and California law issues that make tech severance different from everything else.