Understanding how severance practices vary by country is a critical component of an effective global workforce strategy, more so now than ever, given the worldwide economic slowdown, according to Severance Practices Around the World, a report issued by global consultants Right Management.
"The fast-changing and demanding global market is placing increased pressure on companies to compete more effectively," says Douglas J. Matthews, president and chief operating officer of Right Management. "The subsequent result may be frequent restructuring, downsizing or cutbacks. And when those initiatives are implemented, departing employees need to be supported with severance practices that are aligned with the company's sense of corporate responsibility and values."
The global study, conducted across 28 countries in the summer of 2008, drew more than 1,500 responses from HR professionals and senior managers responsible for making severance decisions. Key findings:
Regardless of employee level, the most common benefits included in a severance package are assistance programs (like outplacement and financial planning), continued benefits (such as health care and financial compensation), and, to a lesser extent, company resources such as an office or car.
Of the 1,524 survey responses, 45 percent were from the Americas (including 456 from the United States), 34 percent were from Europe and 21 percent were from Asia Pacific. A broad cross section of industries was represented.
Stephen Miller is an online editor/manager for SHRM.
