Severance packages

Rockie

We are facing some layoffs in our facility and I know there is some type of rule of thumb on how much severance is usually given per year of service.

We have two tiers of employees - staff employees and senior management. Do you treat these categories differently in your facility?

Any advice would be appreciated.

drehil

I don't have much experience with severance packages and have only used them for senior management and not in a layoff situation. What I did was pay out one week of salary for each year of service. That was decided after doing some local research. Hope that helps.

BettyBoop FL

We pay out one week of salary for each year of employment plus 6 months paid COBRA as a severance package.

ray a

Same as drehil, 1 week per every year of service and only to senior management. Since last August we have laid off roughly 150 ee's, the highest level being a mfg. supervisor and a couple engineers. None of them received severance.

Caroliso

I think any rule of thumb depends on the industry and the severity of your company's financial situation. I hope you are using an employment attorney to make sure you get the language in the severance agreement right and don't overlook any regs that govern terms and layoffs. S/he should be able to offer some guidelines.

We accomplished layoffs a few years ago (we're little over a hundred EEs) and offered severance for the first time ever. We created a policy of two weeks per year of service up to a max of six months of severance for all regardless of position. In retrospect that worked well for most (considering) but was devastating to the 25+ year EE. We wound up negotiating a little more for that person and I think that was the right thing to do.

If we could have offered medical coverage to all during the severance period I would have liked to have done that.

Good luck, Rockie, I've been through this a few times and it never is easy.