Key Takeaways
- Severance is not legally required in most situations
- "Standard" varies wildly by industry and company
- Read every word before signing anything
Last updated: December 2025
What's In a Severance Package?
"Is this offer good or bad?" — You need context to know
Components of a Typical Severance Package
| Component | Description |
|---|---|
| Base Pay Continuation | Weeks or months of salary |
| Pro-Rata Bonus | Portion of annual bonus earned |
| Stock/Equity Treatment | Vesting acceleration or forfeiture |
| Health Insurance | COBRA subsidy or continuation |
| Outplacement Services | Job search help (varies in quality) |
| Non-Compete/Non-Solicitation | Restrictions on future employment |
| Release of Claims | You give up right to sue |
The First Rule: Severance Is Not Required
In the US, there's no legal requirement for employers to offer severance. Exceptions:
- WARN Act: 60-day notice required for mass layoffs (100+ employees)
- Employment contract: Some executives have guaranteed severance
- Company policy: Written policies can create obligations
Most severance is offered in exchange for your signature on a release of claims.
Industry Benchmarks (2024-2025)
| Industry/Company | Typical Severance |
|---|---|
| 16 weeks + 2 weeks/year + 6-month RSU acceleration | |
| Meta | 16 weeks + uncapped 2 weeks/year + 6-month insurance |
| Salesforce | 5+ months for most workers |
| Microsoft | 2 months + 1 week per 6 months of service |
| Amazon | Varies by role (3-12 weeks typical) |
| Finance/Banking | 1-2 weeks per year of service |
| Startups | Often minimal or none |
| Retail/Hospitality | Usually none |
Note: Big Tech layoffs in 2023-2025 have generally been more generous than historical norms—companies were trying to manage PR during mass layoffs.
What the Release of Claims Means
When you sign a severance agreement, you typically release your right to sue for:
- Wrongful termination
- Discrimination
- Unpaid wages
- Breach of contract
Exception: You generally cannot waive claims you don't know about yet, or rights to file EEOC charges (though you can waive monetary recovery).
Read the release carefully. If it's overly broad, that's negotiable.
Test Your Knowledge
What is the WARN Act?
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