November 28, 2005 |
Posted By Diane Pfadenhauer |
Severance Pay Trends = Less
According to the outplacement firm, Lee Hecht Harrison, there is a continuing downward trend in the amount of severance pay provided by companies to laid off employees. According to the survey, discussed here,
- Packages with two or more weeks pay per year of service fell from 55 percent in 2001 to 51 percent this year among executives, still well above 37 percent in 1998.
- Packages among managers and functional staff declined from 40 percent to 38 percent this year, compared to just 29 percent in 1998.
- Thirty-three percent of administrative staff (secretarial and support staff) were given packages with two or more weeks this year, compared to 29 percent in 2001 and 23 percent in 1998.
- The percentage of companies giving less than one week severance pay per year of service increased. Such packages were given to 13 percent of executives this year, compared to 4 percent in 2001 and 6 percent in 1998. Sixteen percent of managers and functional staff received such packages, compared to 6 percent in 2001 and 7 percent in 1998 and 15 percent of administrative staff received such packages this year, compared to 9 percent in both 2001 and 1998.
- Forty-nine percent of companies offer severance to some part-time employees, up from 39 percent in 2001.
- Median minimum severance has remained relatively stable since 1998 at four weeks for senior executives and executives, three weeks for managers and functional staff and two weeks for administrative staff.
- Median maximum severance has increased to 52 weeks for senior executives and to 28 weeks for executives, both up from 26 weeks. Median maximum severance remained at 26 weeks for managers and functional staff and administrative staff.