What is the severance pay?

The severance pay is a package of associated financial compensation and benefits that are offered to some employees when they leave their positions. Some people call severe "golden parachutes", refer to the fact that they allow former employees to float on their severance pay, at least for a while. Such packages can be built into employee benefits in some companies; For example, teachers can get pension benefits after working a specified number of years. The departments are also offered to employees who are released, and are sometimes used to encourage high -paid employees to leave to reduce corporate costs, in which case a severance pay can be called Golden Handshake.

Any number of things can be included in the package. Can help see if your company offers such benefits; Details are often included in hiring contracts or manuals of employees and are worth reading these materials to make sure you understand them. Employees can also beable to negotiate severance pay depending on the circumstances in which they leave. Negotiations can sometimes be delicate, but they can also bring better benefits when they are done well.

Some common inclusion in the severance package are: stock options, health insurance, life insurance, remuneration, paying for unused sick or holidays, assistance in placement of jobs and pension benefits such as those that pay off to the 401 000 plan.

As far as insurance is concerned, some companies continue to cover their employees after leaving with medical and dentures. Companies can also allow employees to buy life insurance plans with the help of a company; Likewise with pension accounts. Stock options are another technique for employee compensationanc because an employee can hang on stocks or sell them if necessary. Severance pay are also commonly provided when the termination is sudden; In some cases, severance pay may include up to six months of reward.

Further payments, such as accumulated back payments for unused days of sick and holidays, are not uncommon and some companies simply offer a one -off amount to leave their employees to thank them for their work. In general, other payments and severance pay are generally based on how long the individual has been employed; For example, the benefits will be much better after 40 years of work.