Severance Benefits

When an employee is laid off, it is a regular (though not legally mandated) practice for the employer to offer a severance package. This package includes severance pay that is usually based upon years of service to the company and current title. It may also include benefits such as stock options and performance bonuses. Severance benefits may also include extended health care coverage. With regards to this, employers are required to inform laid off employees about COBRA, which enables them to purchase the same health benefits they had while employed for up to 18 months. With the exception of COBRA, the employee is not legally obligated to provide severance benefits, unless they are specified in an employees' contract. Employers may also offer to help laid off employees in their search for new work.

Fast Facts

  • By law, the only severance benefit businesses must provide is unemployment compensation.
  • Though an employer may have an official severance benefits policy, it may choose to modify it for individual employees as it sees fit.

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Results 1-5 of 76 for "severance benefits"

  • Lay Off vs. Wrongful Termination

    Originally, a layoff was a temporary suspension from work.  It occurred when a factory needed to install new e...
    • Site: employmentlawfirms.com
    • 3 of 3 user(s) found this useful
  • Is the Severance Package Worth It?

    One of the first questions an employee being terminated and offered a severance agreement should ask is whethe...
  • Severance Pay Laws

    Severance pay, although not a required benefit, may be given to an employee upon job termination. Employers ha...
    • Site: employmentlawfirms.com
    • 4 of 4 user(s) found this useful
  • Severance Agreement: Upsides and Downsides

    Leaving your job or getting fired is just like a relationship ending, it could be amicable and it could also b...
    • By: Rodney Mesriani
    • Site: employmentlawfirms.com
    • 3 of 4 user(s) found this useful
  • Negotiating a Severance Agreement in California

    Severance agreements are commonly awarded by California employers during lay offs. This package is designed to...
    • Site: employmentlawfirms.com

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