A severance pay policy should be arranged prior to employment, however it is not required. Companies are not obligated to provide severance pay. It comes in many forms and with a wide range of value depending on each individual situation. When provided, it may take the form of continued income, insurance, a bonus lump sum, electronics or stocks. This can occur after the elimination of the employee. In such cases, companies make sure to provide equal of similar valued severance to all employees. Failure to do so may allow released employees to sue the company.