severance pay
- Compensation provided to an employee who has been laid off, dismissed, or parted ways through mutual agreement, which may be mandated by some state laws in the event of mass layoffs or plant closures, or if stipulated in an employment contract or handbook
- Upon being laid off due to company downsizing, he received severance pay.
- Her employment contract specified the amount of severance pay she would receive if dismissed.
- When the factory closed, the workers were entitled to severance pay as per state law.
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