Severance Pay
Carolsmith
29 Posts
[font size="1" color="#FF0000"]LAST EDITED ON 03-10-06 AT 12:54PM (CST)[/font][br][br]Plans are to terminate the Controller of our company for cause. Our consultant is advising us to offer her the opportunity to resign and offer her some form of severance to sign off regarding any form of legal action, etc.
I would like to hear from participants in the Forum as to their policy on Severance Pay.
I would like to hear from participants in the Forum as to their policy on Severance Pay.
Comments
We have intentionally avoided writing anything into our Policy Manual re: severance-- since to do so basically makes it an entitlement for all terminated EEs who meet the specified circumstances.
We have offered severance to EEs who were to be terminated, whether for unsatisfactory performance or for cause, ONLY as an inducement to submit their resignation and sign a release agreement (of course with all the required periods to consider the agreement, recommendation to consult and atty, revocation window, etc.) to cover our butt against potential lawsuits. But we have never, in the 6 yrs that I've been here, provided severance pay to a terminated EE without their signing a release.
Basically, your strategy sounds like a good one: offer her severance if she (1) submits her resignation effective by your required date, and (2) signs a release agreement (consult your legal counsel in drafting the release). Faced with the choice of having their income cut off immediately, and suing you (at best a crapshoot, provided you have solid grounds for her termination, and handle the situation appropriately)--vs. having a period of severance pay to continue their income while they're between jobs-- most EEs in my experience will grab the cash up-front and sign the release.