Severance pay is a form of compensation that an employer may provide to an employee upon termination of employment. It is intended to provide financial assistance to the employee during the transition period between jobs. Severance pay can be provided in the form of a lump sum payment, or it may be paid out over a period of time. The amount and duration of severance pay will vary depending on the circumstances of the termination and the terms of the employee’s contract. In some cases, employers may also offer additional benefits such as health insurance coverage or job placement services. Understanding the meaning of severance pay can help employees make informed decisions about their career paths.
What is the Meaning of Severance Pay?
Severance pay is a form of compensation paid to an employee upon termination of employment. It is intended to provide financial assistance during the transition period between jobs and can be based on length of service, salary, or other factors. Severance pay may also include benefits such as health insurance, vacation pay, and outplacement services.