What is severance agreement ? - Definition from WhatIs.com

Definition

severance agreement

Part of the Business terms glossary:

A severance agreement is a contract between an employer and employee documenting the rights and responsibilities of both parties in the event of job termination. 

The contract specifies any severance package of pay and benefits and the conditions under which it will be provided or withheld. Common elements of a severance agreement include: 

  • The amount of any severance pay in lieu of contracted notice period.
  • Any extended benefits, such as healthcare or insurance, and the length of time they will be provided.
  • A non-compete clause forbidding the employee to work for a competitor within a specified time period.
  • An agreement not to file a wrongful dismissal lawsuit. 

Severance agreements are sometimes offered as part of a job contract. More often, they are offered as part of job termination, for example in the case of layoffs. 

This was last updated in July 2013
Contributor(s): Ivy Wigmore
Posted by: Margaret Rouse

Related Terms

Definitions

  • traceability

    - Traceability, in supply chain management, is the ability to identify, track and trace elements of a product or substance as it moves along the supply chain from raw goods to finished products. The ... (SearchManufacturingERP.com)

  • mass notification system

    - A mass notification system helps organizations send one-way alerts to staff and the public during a crisis situation. Notification can be triggered by humans, as well as sensing or security devices. (SearchDisasterRecovery.com)

  • backdoor selling

    - Backdoor selling is the unscrupulous practice of seeking information beyond what is publicly available as a means of gaining a competitive advantage for a contract or sale. (WhatIs.com)

Glossaries

  • Business terms

    - Terms related to business, including definitions about project management and words and phrases about human resources, finance and vertical industries.

  • Internet applications

    - This WhatIs.com glossary contains terms related to Internet applications, including definitions about Software as a Service (SaaS) delivery models and words and phrases about web sites, e-commerce ...

Ask a Question. Find an Answer.Powered by ITKnowledgeExchange.com

Ask An IT Question

Get answers from your peers on your most technical challenges

Ask Question

Tech TalkComment

Share
Comments

    Results

    Contribute to the conversation

    All fields are required. Comments will appear at the bottom of the article.