Other Than Money, What Can a California Severance Package Include? A 2025 Guide.

Other Than Money, What Can a California Severance Package Include? A 2025 Guide

Losing a job unexpectedly is tough, especially in California, where the law does not require employers to provide severance pay unless specified in an employment contract, collective bargaining agreement, or company policy. Nevertheless, some employers offer employees severance pay to help with the transition. If you are facing termination, you might wonder if a severance package can include anything other than money. The short answer is yes. While severance packages are often associated with lump sum payments, employers sometimes offer other additional benefits. Read on to find out the other benefits you could receive.

What Does a Severance Package Typically Include?

Typically, a severance package includes a lump sum payout calculated based on one’s years of service. In addition, a typical package may consist of other perks, such as pension or retirement contributions for a set period. A severance package may also include non-disparagement clauses to prevent an employee from speaking negatively about the company after leaving, and legal claim waivers, meaning that once you sign the severance agreement, you relinquish your right to pursue legal action. However, a waiver may not be enforceable in some instances. 

Non-Monetary Benefits Employers May Offer

While financial compensation is the most significant part of a severance package, not all packages come as a paycheck. Sometimes, employers may offer other benefits, such as:

• Extended Health Benefits

Even if you lose your job, your health insurance does not have to end immediately. Under COBRA, you can continue your employer-sponsored health plan at your own expense. However, some companies offer to pay part or all of your COBRA premiums for a set period, easing the financial burden.

• Outplacement Services

Some employers offer career counseling, resume writing help, and job search support to help former employees land new jobs quickly. This can be especially useful if you have been with one company for a long time and need assistance navigating the job market.

• Continuation of Company Perks

Some companies allow departing employees to retain certain workplace perks, including gym memberships, company-issued laptops or phones, and access to professional development programs.

• Stock Options

If you had stock options through your employer, your severance agreement might outline how and when to access these benefits. Be sure to review the terms carefully, as stock options often have strict deadlines for exercising them.

• Letters of Recommendation and Job References

An employer can also provide a strong letter of recommendation, which can be invaluable when applying for new jobs. Additionally, some companies include a written commitment to provide references as part of a severance agreement. 

• Training Programs

If you want to upskill, your employer may offer financial support for education, certification programs, or vocational training. This can significantly improve your job prospects and make the transition easier.

• Intellectual Property Rights

Depending on your industry, you may have developed patents, trademarks, or proprietary content while working at your soon-to-be former company. Some employers allow departing employees to retain ownership or usage rights to such intellectual property.

While non-monetary benefits can be valuable, severance agreements must comply with the labor laws. For instance, if you are over 40, you must be given at least 21 days to review the agreement before signing. After signing, you also have seven days to revoke the deal. It is always advisable to obtain legal advice to ensure your severance package is fair and you fully understand your rights before signing. 

Contact a California Employment Lawyer Today

Whether you have been offered financial compensation or non-monetary benefits, contact an experienced California employment lawyer to ensure you receive a fair deal.