Do you know how your severance policies stack up against your biggest competitors and your most successful peers? As a Human Resources leader, do you have the information you need to make an informed decision about how you’ll approach your severance, outplacement, and ongoing benefits packages in the coming year?
A few months ago, I started asking these questions, and when I couldn’t find any good answers, I realized that it was time for someone to fill in the gaps. While there are certainly severance studies published by a few credible sources, the information doesn’t always drill down into actionable items that are applicable to US-based companies, and there are certainly even fewer guides to using that data to implement everything from standard to executive level severance, benefits, and outplacement.
Just a few weeks ago, RiseSmart launched its Survey on Severance and Workforce Transition for 2014 in an effort to provide the most comprehensive and unique resource for US-based companies to gain a better perspective about the competitive landscape for severance. Now that we’re at the midpoint of the survey, I wanted to share some of the insights that have come from the confidential answers we’ve received so far—to give you a teaser of some of the information to come.
With Whom Are Your Benchmarking?
The overwhelming majority of our respondents so far are Director-level Human Resources executives and above, representing every single state in the union. Nearly every company has more than half of its employees based in the US, so the data you’re about to receive will be directly applicable to companies whose policies must conform to US law.
We’ve also received responses from a wide range of industries, so you’ll see everyone from health care to retail to software to government represented, with more than 40% of those companies ranked Fortune 1000 and above.
What Are They Offering?
Severance, it appears, is not a standardized policy for all employees for the overwhelming majority of companies. Differences in title, level, and position are the motivating factor for the differences in severance pay, yet when employers do offer severance, the top three reasons are:
To take care of employees
To limit company liability
To protect brand reputation
And, interestingly, nearly 70 % of companies include outplacement services as a part of their standard severance packages.
What Can You Do with This Information?
While this is only a brief dip into the shallow end, rest assured that the guide will take you on a deep dive into the US severance landscape this year. From just this first glance into the data, we can already see that severance is a consideration for the top executives at the country’s largest companies in every single industry. It’s a consideration, because it does the work of protecting impacted employees, protecting the company, and protecting the brand—and some of that protection actually comes from the ability of impacted employees to access outplacement services. And while severance pay is not standardized for all employees, access to basic outplacement, for the majority of companies, is.
Already, we can see that, to be competitive, your company needs to start looking at severance as a necessity, and not an option, while making outplacement a standard part of your offering.
If you’d like to learn more about this survey and what you can do with the data once it’s released later this year, you should definitely check out the upcoming HCI webinar that I will be giving with Ann Weiser, former CHRO of Activision Blizzard. Don’t miss your chance to be the first to hear our preliminary findings: