Severance


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Related to Severance: severance agreement

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 pay in Japan over the past two years has typically ranged from 12 months to 36 months at overseas banks, according to the Federation of Foreign Bank Employees Union.
Initial approval from the state Senate was also reportedly given to an overall severance tax reduction to 4% from 5% by July 2018.
Severance tax is incurred when natural resources are extracted from the earth within a taxing jurisdiction.
Quality Stores did not agree with the IRS's position that the severance payments constituted wages for FICA purposes, so it filed claims for refunds of both the employer portion and, to the extent they received authorizations from the employees, the employee portion of the tax.
He described Mr Parry-Jones' severance settlement as a "diamondencrusted, gold-plated package".
Severance agreements also cannot require employees to waive the right to file an EEOC charge or to participate in an EEOC proceeding or investigation.
65 percent-45 percent or more in severance costs from payroll tax savings and the coordination of UI benefits.
Indeed, Social Security statistics assert that less than 10 percent of wage earners benefit from severance pay in reality.
A dispute arose concerning the severance payment amount, and the CEO filed a motion to arbitrate under the employee agreement.
The severance package will allow Ford to close the Genk plant by the end of 2014.
Figures for 2011/12 show that in Stockton, Middlesbrough and Redcar and Cleveland a total of almost PS10m was paid out in severance packages.
Reforming severance pay; an international perspective.