State file — Iowa
Severance itself is almost never required by law — but the paper around your exit is. In Iowa, three state rules shape your negotiation: when your last paycheck must arrive, whether a non-compete can follow you to your next job, and what notice a layoff required. If you are 40 or older, the federal clocks (21 or 45 days, plus 7 days to change your mind after signing) apply on top of everything here.
Federal rule only — no Iowa statute found giving a general state consideration/revocation period for severance or settlement agreements beyond the federal OWBPA.
Run the deadline checker — it counts the federal clock and Iowa's clock together and gives you the dates.
No general statutory ban or earnings threshold. Enforceable under common law only if it satisfies a reasonableness test: necessary to protect a legitimate business interest, and reasonable in duration/geography/scope without undue hardship or harm to the public; courts may reform an overbroad covenant.
Why it matters at the exit table: a non-compete you sign on the way out can matter more than the severance check. If the clause would block your next job, narrowing it is one of the most common — and most granted — negotiation asks.
On suspension or termination, pay all wages earned (less lawful deductions) not later than the next regular payday for the pay period in which the wages were earned. Commission true-up differences are due within 30 days of termination.
Unused vacation: If vacation is due under an agreement or an employer policy establishing pro rata vacation accrual, the increment is paid in proportion to the fraction of the year the employee was actually employed.
Final pay is owed whether or not you sign anything. If the date passes without your money, your state labor agency takes these complaints — and many states add penalties for every day of delay.
Iowa has its own layoff-notice law (a mini-WARN law): Iowa WARN Act: employers with 25 or more employees must give 30 calendar days' advance notice of a business closing or mass layoff resulting in employment loss of 25 or more full-time employees (including a layoff of 25+ for a period exceeding 6 months).
Notice failures have their own remedies (back pay for each day of missed notice, in the federal law's case) — separate from the severance agreement, and worth a question if your layoff was large and sudden.
Included in the $49 SeveranceDecoded Kit
One payment. Yours to keep. Works for any severance agreement, any state.
Back to severance laws by state · the deadline checker