Some Reduce Severance, Others Add Benefits

From DICE, March 20, 2009...

Companies aren’t just downsizing the number of employees. Some intend to downsize severance packages as well. Hewitt Associates, a human resources consulting firm, surveyed about 228 large U.S. companies with 4.5 million workers in a range of industries, and found 43 percent of those planning severance changes expect to reduce cash payments, while 21 percent intend to trim other benefits. Says The Wall Street Journal:

Companies appear to be revisiting their severance packages more frequently in this downturn and making policies more formal. Typically, employers re-evaluate their severance practices just once every five years, says David Wise, a senior consultant at Hay Group. “It’s highly unusual for companies to revisit their severance programs regularly,” says Wise. “The fact that so many companies have considered changes over the last year is very significant.”

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