Understanding your severance package
When you are about to leave your job, you should check that the severance package you will be given contains all the elements you are expecting. Your severance package could include:
- Statutory redundancy pay
- Money in lieu of notice
- Pension payments
- Stock and shares
If you are currently negotiating your severance package with your employer, call us and we can recommend an employment specialist lawyer who can ensure you get the best deal possible.
Severance pay is usually a payment your employer gives you when you leave your job. Severance law states that your final payment could include:
- Money in lieu of notice
- Money instead of or including statutory redundancy pay if you qualify for these types of payments
If you are unsure of your legal standing regarding severance law, always consult a solicitor with experience of employment law well before you are due to leave your job.
Severance law states that your severance package should be calculated using the current employment rules that are in force. If you are unsure of the contents of your severance package, don’t delay in contacting a solicitor with experience of employment law. They will be able to assess your particular circumstances and relate these to the package your employer is offering.
In addition, your severance package could contain what is called a compromise agreement. If you are leaving your job because you have been dismissed, and you think that you have been dismissed illegally under employment laws - perhaps you have been discriminated against - you have the right to use an employment tribunal.
Employers use compromise agreements in return for you giving up most of your employment rights, including your ability to use an employment tribunal. You will usually be paid a sum of money, but it is also common for other benefits to be offered to you as well.
As much of the compromise agreement is open to negotiation, you should contact a solicitor as soon as you can. They can:
- Assess the current state of your compromise agreement
- Negotiate with your employer to improve its terms, if necessary - especially the payment you will receive as part of your severance package
You may be able to obtain this advice from your trade union if you are a member, or from the law firms that operate in your area.
Employment law is complicated in some areas, and none more so than in the area of severance packages. If you are in any doubt about your severance package, always seek legal advice as early as you can. For detailed information on compromise agreements, see our guidance page on compromise agreements.
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