How Much Severance Should You Get?
Find out in 30 seconds. Free calculator estimates your package based on salary, tenure, industry, and state law.
Free Severance Pay Calculator
Estimate your severance package based on your salary, years of service, and industry
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📋 Free Severance Negotiation Checklist
The exact steps employment lawyers use to negotiate higher severance. Used by 10,000+ employees.
How Is Severance Pay Calculated?
While there is no federal law requiring employers to provide severance pay, most companies offer it as part of their separation policy. The U.S. Department of Labor states that severance pay is a matter of agreement between an employer and an employee.
The most common formula is 1-2 weeks of pay per year of service. For example, if you worked at a company for 5 years and earned $75,000 annually, you might expect between 5-10 weeks of pay ($7,200 - $14,400).
However, severance can vary significantly based on your industry, position level, company policy, and individual negotiation. The WARN Act (Worker Adjustment and Retraining Notification) may also require employers to provide 60 days notice or pay in lieu of notice for mass layoffs affecting 50+ workers at companies with 100+ employees.
What Affects Your Severance Amount?
📅 Years of Service
The biggest factor in most formulas. Longer tenure typically means more severance weeks. Most companies use 1-2 weeks per year of service as a baseline.
💼 Position Level
Executives and senior managers often receive 2x or more the standard package. C-suite exits frequently include 12-24 months of pay.
🏭 Industry Standards
Tech and finance typically offer 2-4 weeks/year, while retail may offer only 0.5-1 week/year. Know your industry benchmark.
⚖ State Laws
New Jersey and Maine have mandatory severance for certain layoffs. New York requires 90 days WARN notice vs. 60 federal.
Severance Pay by Industry
| Industry | Typical Range | Notes |
|---|---|---|
| Technology | 2-4 weeks/year | Often includes stock vesting acceleration |
| Finance & Banking | 2-4 weeks/year | May include prorated bonuses |
| Consulting | 2-4 weeks/year | Competitive with tech and finance |
| Healthcare | 1-2 weeks/year | Varies by hospital system |
| Manufacturing | 1-2 weeks/year | Union contracts may specify terms |
| Retail | 0.5-1 week/year | Generally lowest severance |
How to Negotiate Your Severance (Get More Money)
Most severance packages are negotiable, but most employees don't try. Here are the key areas that can add thousands to your package:
- ✓Ask for more weeks: If offered 2 weeks per year, counter with 3 weeks per year. This alone can add 50% more to your package.
- ✓Extended health benefits: COBRA costs $600-2,000/month. Negotiate employer-paid COBRA for 6-12 months - worth $3,600-$24,000.
- ✓Outplacement services: Request career coaching and professional resume writing (worth $500-3,000).
- ✓Stock options: Ask for accelerated vesting or extended exercise windows. This can be worth tens of thousands.
- ✓Positive reference: Get a written commitment for neutral or positive references. This protects your future career.
Not Sure If Your Offer Is Fair?
Employment lawyers routinely help workers negotiate 2-5x their initial severance offers. Many offer free initial consultations.
Frequently Asked Questions
Is severance pay required by law?▼
No, there is no federal law requiring severance pay. However, New Jersey and Maine have mandatory severance for certain mass layoffs. The WARN Act requires 60 days notice (or pay in lieu) for layoffs of 50+ employees.
Is severance pay taxable?▼
Yes. Severance is taxed as supplemental wages at a flat 22% federal rate, plus your state income tax rate. For example, in California you'd pay about 34.3% total (22% federal + 12.3% state).
Can I negotiate my severance package?▼
Absolutely. Most packages are negotiable. An employment lawyer can help you identify leverage points and often negotiate 2-5x the original offer, especially if there are potential legal claims.
Does severance affect unemployment benefits?▼
This varies by state. Some states like New York delay unemployment while receiving severance. Others like New Jersey allow both simultaneously. Check your state's specific rules.
What if I'm over 40 years old?▼
You have extra protections under OWBPA: at least 21 days to review (45 for group layoffs), 7 days to revoke after signing, and your employer must advise you to consult an attorney.
Should I sign my severance agreement immediately?▼
Never sign immediately. Take the full review period (21-45 days). Have an employment lawyer review it. Negotiate for better terms. Once signed, you typically waive your right to sue.
What should a severance package include?▼
A comprehensive package includes: cash payment (weeks of pay), COBRA health coverage, unused PTO payout, outplacement services, positive reference letter, stock option extensions, and non-compete modifications.
How much does an employment lawyer cost?▼
Many employment lawyers offer free initial consultations. Some work on contingency (they only get paid if they increase your severance). Others charge $200-500/hour. The ROI is often 5-10x the legal fees.
When to Consult an Employment Lawyer
Consider consulting an employment attorney if:
- • You believe you were discriminated against or wrongfully terminated
- • The severance offer seems below industry standard for your role
- • You're being asked to sign a non-compete or non-disclosure agreement
- • You're part of a mass layoff that may trigger WARN Act requirements
- • You have unvested stock options or deferred compensation at stake
- • You're over 40 and want to ensure OWBPA compliance
An employment lawyer can typically negotiate 2-5x your initial offer. Many offer free consultations, and some work on contingency so you only pay if they increase your package.
Think Your Severance Is Too Low?
Employment lawyers have helped workers negotiate 2-5x their original offers. Get a free consultation.
📋 Free Severance Negotiation Checklist
The exact steps employment lawyers use to negotiate higher severance. Used by 10,000+ employees.
Severance Pay by State
Select your state for specific laws, tax rates, and WARN Act details
Severance Pay by Industry
See typical severance ranges for your industry