It refers to the pay an employee gets after a competition in employment. Employers don’t need to pay the employee severance unless it is in the employment contract or the company. It helps companies ensure a smooth transition between employer and employee.
Severance pay ensures several benefits to the employee, such as vacation and health insurance. In addition to this, various companies also offer outplacement assistance. It acts as goodwill for the company as it assures financial security to the employee. Severance pay at the time of outplacement helps the employees find new placements with the help of resume writing, job coaching, job searching and other equipment. It makes the transition of the employee smooth and without any stress.
