Kansas City, Kan. – Layoffs across the country have placed greater importance on severance pay and policies. As unemployment rates rise, these packages become critical to organizations and employees alike. The 2008 Compensation Data results showed just over half, or 57.9 percent, of the employers surveyed have a severance policy in place.
Severance pay is calculated a number of ways. When comparing those with a severance policy, 44.9 percent calculate it based on years of service. About a third utilize a combination of fixed number of weeks and years of service. Almost 20 percent rely on employer discretion for severance pay.
The percentage of organizations offering severance pay varies by industry. Manufacturers have the highest percentage, 61.4 percent. They are followed closely by insurance companies at 61.2 percent. Not-for-profit organizations represent the smallest percentage, 44.4 percent.
“Some employees have made the news recently with suits against past employers under the federal Worker Adjustment and Retraining Notification (WARN) Act,” said Amy Kaminski, manager of marketing programs for Compdata Surveys, the nation’s leading compensation and benefits survey data provider. “WARN requires most employers with 100 or more employees to provide notification 60 days in advance of plant closings and mass layoffs.”
Outplacement services are provided by less than 40 percent of organizations. They are most offered to management employees. Those in technical/professional and administrative roles are also offered these services at 25.7 and 20.2 percent, respectively. They are least offered to hourly workers.
About the Survey
Compensation Data 2008 contains data on 637 job titles ranging from entry-level to top executives. Information was collected from thousands of employers representing millions of employees across the country. The results provide a comprehensive summary of pay data, benefits information and pay practices with an effective date of March 1, 2008.
Compdata Surveys is the nation’s leading compensation and benefits survey data provider. Data is collected annually from thousands of organizations across the country. Compdata Surveys has been providing accurate, reliable data at affordable prices to organizations since 1988. For further information about the compensation and benefits surveys, contact Amy Kaminski at (800) 300-9570 or akaminski@compdatasurveys.com.
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