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 ?
These programs couple severance benefits, such as cash payments to cover lost salary and bonuses, plus continuation of health and welfare benefits, with specific plan provisions previously described.
Lathrop & Gage, which represents Dickens, said the investigation determined he was fired "without cause" and, therefore, is entitled to the additional severance benefits requested in the Feb.
The promised severance benefits in such a case are considered part of the employer's pay/benefit package, which compensates the employee for services.
In that case, Lockheed gave severance benefits to employees who were going to be laid off as a result of a corporate merger.
Reuters quoted the Dow Jones memo as saying that those losing their jobs would get full severance benefits.
Alberto-Culver expects to take restructuring charges of $13 million and $3 million in the first and second quarters, respectively, of fiscal 2007, primarily for severance benefits.
Termination benefits include early-retirement incentives, severance benefits, and other termination-related benefits.
It would establish guidance for benefits, such as early-retirement incentives and severance benefits that are provided as the result of voluntary or involuntary terminations, and is intended to enhance comparability of financial statements by requiring governments to account for similar termination benefits in the same manner.
will eliminate 1,000 jobs and take a charge of $50 million for severance benefits as it moves to complete a spinoff of its money-losing semiconductor unit, the company said Tuesday.
We are committed to helping our employees transition to new jobs inside and outside the company, and to offering severance benefits for those who leave the business.
Plaintiff Matthew Whitley will receive $100,000 in cash, some $140,000 in severance benefits and $300,000 for attorneys' fees.
The proceeds will be used to pay workers 100% of their severance benefits and cover other liabilities, Chiquita said.