Severance pay is a means of compensation for qualified employees who have been dismissed. Your severance entitlements will depend on a combination of factors including your contract, your age, the position you hold, your length of service and your employer’s payroll. While there are statutory minimums concerning severance, courts may determine an employee to be entitled to more based on their common law rights.
If your employer decides to terminate your employment without reasonable justification or notice, you will likely be presented with a severance agreement detailing your pay and benefit entitlements. These entitlements should at least match what you would have otherwise earned had you been given notice.
A good compensation package becomes increasingly important as you move up the ladder of responsibility and power. There are many things besides your salary that should be taken into account when negotiating severance package including bonuses, benefits, pension contributions, stock options, car allowance any other financial benefits you receive.