Guide to severance reveals positive changes in payout, eligibility and benefits
SAN JOSE, Calif., March 22, 2017 — RiseSmart, a leading provider of contemporary career transition services, today released its 2017 Guide to Severance and Workforce Transition. The Guide helps organizations ensure their severance policies are competitive and comprehensive. Containing rich data from a survey of U.S. businesses with at least 500 employees, the Guide gives organizations an easy way to benchmark their severance eligibility, duration and benefits against peers in their industries and geographies.
RiseSmart’s new Guide outlines how severance offerings have evolved since 2014, when RiseSmart first published its 2014 Guide to Severance and Workforce Transition. Today, more companies are providing salary payouts for longer periods of time, offering more flexibility for employees through working notice, and including benefits outside of healthcare as part of their standard packages. These changes directly correlate with the evolution of workplace culture and workforce expectations, including an increased expectation for employee fairness, larger market competition for talent, growing recruitment and hiring costs as well as overall acknowledgment of the importance of a positive brand reputation.
“We’ve watched workforce expectations and company cultures evolve and change over the past few years, and it’s no surprise that the addition of contemporary outplacement services as part of severance packages presents a distinct advantage for organizations,” said RiseSmart President and CEO, Sanjay Sathé. “Knowing what payment, notification, benefits and outplacement options to offer in their severance packages helps companies mitigate risk and positively impact employee relations and their employer brand.”
Study findings include:
- 90% of organizations offer severance, but only 38% offer it to all employees
- An “employee-first” company culture is the #1 reason companies offer severance
- 45% of companies have formal programs to redeploy impacted employees to open positions within the company
The complete study expands upon these findings, provides in-depth benchmarking data across industries and company size, and identifies trends surrounding severance, including:
- The top trends influencing changes in severance packages
- The top three factors used when calculating severance
- Length of notification periods, broken out by industry and company size
- Amount of salary equivalence in severance payouts, by level, company size and industry
- Benefits included in severance packages
- Strategies for retention of crucial talent during a working notice
- COBRA or health plan continuation practices during a mass layoff event
- The influence of the WARN Act
The growing need to create a positive employee experience and maintain good relationships with all employees has prompted a trend toward offering outplacement to more employees, regardless of role. In 2017, nearly half of those surveyed understand the positive impact offering outplacement to transitioning employees can have on preserving employee relationships and employer brand reputation.
“Employers of choice realize that the employee experience doesn’t end when workers walk out the door,” said Sathé. “Our Guide has identified areas of opportunity for organizations looking to bring their severance policies in line with evolving industry trends and best practices in 2017 and beyond.”
For more information about RiseSmart visit www.RiseSmart.com. Download the 2017 Guide to Severance and Workforce Transition.
RiseSmart, a Randstad company, is the leading provider of contemporary career transition services for organizations in more than 40 industries and 70 countries. RiseSmart's results-oriented approach to outplacement and redeployment combines highly personalized services with proprietary, cloud-based technology for job seekers. The company provides its corporate customers with outplacement efficiency, specialized training, and secure, cloud-based reporting. Founded in 2007, RiseSmart delivers landing rates exceeding 80 percent and time-to-placement 60 percent faster than national averages. The company has earned awards and recognition from more than a dozen organizations, including Bersin by Deloitte, Gartner Inc., the Brandon Hall Group, and Fortune magazine. For more information, visit www.risesmart.com.