severance pay

American  

noun

1. money, exclusive of wages, back pay, etc., paid to an employee who has tenure and who is dismissed because of lack of work or other reasons beyond the employee's control.

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severance pay British  

noun

1. compensation paid by an organization to an employee who leaves because, through no fault of his own, the job to which he was appointed ceases to exist, as during rationalization, and no comparable job is available to him

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Etymology

Origin of severance pay

First recorded in 1940–45

Example Sentences

In August, Mr Musk and X agreed to settle a separate lawsuit filed by roughly 6,000 former rank-and-file Twitter employees who argued they were owed $500m in severance pay.

From BBC

But Twitter only gave sacked workers at most one month of severance pay, while some did not receive anything, according to the lawsuit.

From BBC

Former workers posted on social media that they were given 10 weeks of severance pay.

From Los Angeles Times

Department of Labor states there is no requirement for employers to offer severance pay.

From Salon

If you do get severance pay, be aware that the amount you receive is taxable.

From Salon