Question:

Is a severence pay required when a group of salaried employees are laid off?

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When a large company lays off a lot of salaried employees are they required by law to issue a severence pay. I know hourly employees don't get severence pay but what about salaried employees?

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  1. No, severance pay is something given voluntarily by some companies, there is no law requiring it.

    There are laws requiring a certain amount of notices if a significant percentage of the workforce is being laid off - they are called WARN laws.


  2. absolutely NOT

    if you are not working you do not get paid.

    Some companies do it on their own.

  3. not at all severance is at the discretion of the company

  4. I think severance is usually something that is offered in order to get people to leave voluntarily. But it varries..

    A severance package is pay and benefits an employee receives when they leave employment at a company. In addition to the employee's remaining regular pay, it may include some of the following:

    An additional payment based on months of service

    Payment for unused vacation time or sick leave.

    A payment in lieu of a required notice period.

    Medical, dental or life insurance

    Retirement (e.g., 401K) benefits

    Stock options

    Assistance in searching for new work, such as access to employment services or help in producing a résumé.

    Severance packages are most typically offered for employees who are laid off or retire. Sometimes, they may be offered for people who resign, regardless of the circumstances; or are fired. Policies for severance packages are often found in a company's employee handbook, and in many countries are subject to strict government regulation. Severance contracts often stipulate that the employee will not sue the employer for wrongful termination or attempt to collect on unemployment insurance, and that if the employee does so, then he must return the severance money.

    In my husbands case, he had 8 years in with Delta airlines. They had made serveral cuts, so in closing our local branch they offered severance for those who did not wish to follow the sinking ship. On the other hand, had we not taken it, then I think lay offs continue down a list based on senority severance free.

    Check company policies and your local business laws to know your entittlements. You can get unemployment for sure(with out severance), but that is a whole different set of hoops to jump through. Good luck!

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