If you are losing your job, you are probably hoping to receive a severance package: money, and perhaps some additional benefits, to help tide you over until you find new work. However, many employees are surprised to learn that employers aren't generally required to pay severance to laid-off or fired workers. A few states require employers to pay severance to employees who lose their jobs in a mass layoff or plant closing, but otherwise severance isn't legally required.
However, employers can obligate themselves to pay severance, in a contract, by written policy, or by longstanding practice. Even if they haven't promised to do so, employers might offer severance in some situations (for example, when laying off long-term employees). In this section, you'll learn all about severance: when it's required, how to negotiate a package, tax rules, and more. You'll also learn about releases: agreements not to sue, which many employers require employees to sign as a condition of getting severance.