Benchmark: Severance Policies
Downsizing affects small companies as well as large ones. In a recent survey, 66% of all companies with fewer than 100 employees said they had a severance policy, and 51% of those policies were in writing. Severance was based solely on years of service at 31% of the companies. Here's how the companies with policies calculated severance pay for different types of employees:
Percentage that paid that severance to . . .
|1 week's pay per year||59%||62%||72%|
|2 weeks' pay per year||19%||29%||25%|
|3 weeks' pay per year||5%||1%||0%|
|1 month's pay per year||11%||7%||4%|
|More than 1 month's pay per year||6%||2%||0%|
Note: Numbers have been rounded.
Source: "A Benchmark Study: Severance," Lee Hecht Harrison, New York City, 1995.* * *
DONNA FENN | Inc.com Contributing Editor
Donna Fenn is the author of Upstarts! How GenY Entrepreneurs Are Rocking the World of Business and 8 Ways You Can Profit From Their Success, an exploration of the ways Gen Y is changing the entrepreneurial landscape.