severance pay


noun

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.

Origin of severance pay

First recorded in 1940–45

British Dictionary definitions for severance pay

severance pay

noun

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