Severance

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Severance

A settlement received after being released from a corporation. In the context of corporate governance, an agreement that assures high-level executives of their postions or some compensation and are not contingent upon a change in control.

Severance

A payment often (but not always) made in a lump sum that occurs when an employee is laid off or fired. Severance is sometime voluntary; that is, an employee may choose to quit and take a severance that is offered instead of staying and risking a layoff with no severance. The amount of severance is determined by the employee's length of time at the company, previous pay rate, and other factors. Accepting a severance makes one ineligible to collect unemployment insurance or to initiate a wrongful termination lawsuit. A severance exists in order to reduce the risk of the company when layoffs become necessary and to improve employee morale.
References in periodicals archive ?
Severance benefits should be payable only in the event of involuntary termination or voluntary termination that occurs for "good reason" (i.
You may condition the receipt of severance benefits on the waiver of the employee's right to file a lawsuit or collect monetary or other personal relief.
There is at least anecdotal evidence that generous severance benefits, which are intended to be a bridge to facilitate transition to a new job, may actually in some instances simply be a crutch which only delays an active job search.
In each instance, employees who signed a no-suit agreement received more severance benefits than those who didn't.
The firm argued that: (i) H&R Block Financial Advisors and H&R Block withheld from Fitzgerald certain stock options that they were contractually obligated to pay him, and (ii) H&R Block Financial Advisors and H&R Block refused to pay Fitzgerald severance benefits as required by the terms of the company severance plan.
FOR A COMPANY TO BE ELIGIBLE, IT MUST HAVE PAID severance benefits to employees under an established reduction-in-force plan.
Moreover, you can share some of those savings with departing employees in the form of more generous severance benefits.
Such costs include severance benefits and outplacement services for plant employees, including setting up a Career Transition Center, which will work with labor officials and outside career counselors to help employees find new jobs.
The job eliminations are anticipated to be in large part complete by mid-year 2009 and all those impacted by these actions will be eligible for severance benefits and outplacement support.
Windstream expects to incur a $6 million charge in the fourth quarter to pay severance benefits to affected employees.
Don't try to hide your severance benefits, but don't wait for your severance benefits to expire before you register.