Even as the national unemployment rate begins to level off, having a well-defined severance policy in place remains important to both employees and companies alike
(PRWEB) October 15, 2009
As the unemployment rate catapulted upwards to nearly 10 percent over the past year, the importance of severance polices was prevalent at companies across the country. The 2009 BenchmarkPro results showed that 55.2 percent of companies surveyed currently have a severance policy in place.
Companies in the manufacturing industry report having severance policies at a rate of 66 percent, compared to the insurance industry, 61.9 percent. Healthcare offers severance at a rate of 53.6 percent, while utility companies offer it at 45.4 percent. Severance is offered least to employees at not-for-profits, 41.6 percent.
Severance policies also vary by region, with companies in the Northeast offering severance at a rate of 58.5 percent. This is closely followed by companies in the Southeast, 55.4 percent. Companies in the Midwest and West both have severance policies in place at a rate of 55.1 percent, while organizations in the South Central region only offer severance at a rate of 51.7 percent.
"Even as the national unemployment rate begins to level off, having a well-defined severance policy in place remains important to both employees and companies alike," said Amy Kaminski, manager of marketing programs for Compdata Surveys, the nation's leading compensation and benefits survey data provider. "Providing severance pay not only provides a crutch for outplaced workers seeking new employment, but may also protect companies from potential lawsuits filed, as a result of layoffs."
To calculate severance companies used a variety of methods. Paying severance by years of service was utilized by 43.5 percent of companies, while using a fixed number of weeks was employed by only 3.5 percent of organizations. A combination of both years of service and a fixed number of weeks was used by 33.6 percent of organizations surveyed. Companies paid out severance based on the employer's discretion at a rate of 16.8 percent.
About the Survey
BenchmarkPro contains data on over 230 benchmark titles. Data is collected annually from employers across the country. The results provide a comprehensive summary of pay data and pay practices with an effective date of March 1, 2009.
Compdata Surveys is the nation's leading compensation and benefits survey data provider. Thousands of U.S. organizations provide data each year ensuring the reliability of our results. Compdata Surveys has been providing comprehensive data at affordable prices to organizations from coast to coast since 1988. For further information about the compensation and benefits surveys, contact Amy Kaminski at (800) 300-9570.
This press release was distributed through PR Web by Human Resources Marketer (HR Marketer: http://www.HRmarketer.com) on behalf of the company listed above.