Today I received a "Severance Package"...what does it mean? What happens if I sign it?? They didnt really explained to me what it was they just said I had 45 days to return it...so I'm sooo confused if I should sign or not and what it means, does any1 kno

Traditionally, a "Severance Package" is a way for a company to release you, but not in a "bad" way, because they will probably offer you a lot of money (several thousand dollars) and a very favorable reference from them, so anyone else knows that you weren't laid off due to any kind of wrongdoing on your part.

"A severance package is a bundled package of financial compensation and benefits which is offered to some employees when they leave their positions. Some people call severance packages “golden parachutes,” referring to the fact that they allow former employees to float on their severance benefits, at least for a while. Such packages may be built into employment benefits in some companies; teachers, for example, may receive retirement benefits after working a set number of years. Severance packages are also offered to employees who are laid off, and they are sometimes used to encourage high paid employees to leave to bring company costs down, in which case a severance package may be called a golden handshake."

Source: http://www.wisegeek.com/what-is-a-severance-package.htm

"A golden handshake is a hefty severance package which is offered to senior executives and other high ranking employees. Often, the terms of a golden handshake are included in a hiring contract, and they are viewed as insurance against sudden or involuntary job termination. A golden handshake may also be offered to an employee to encourage him or her to retire; this is common in systems like schools, where long-term employees make more money, and it can be more cost efficient to hire entry level teachers."

Source: http://www.wisegeek.com/what-is-a-golden-handshake.htm

I hope the above information gives you a better understanding of your situation. Basically, you are being given "early retirement," and your pension takes the form of a lump-sum payment, instead of a monthly income for the rest of your life.

It would be a good idea to have your attorney read that document BEFORE you sign it, so s/he can advise you of what your options are (if any) and what s/he would recommend that you do.

+5

The other answer is not necessarily correct.

A severance package is compensation you receive for agreeing to sever your employment with an employer. An employer will give a severance package to employees the like, but simply do not have enough work to continuing employing them. They will also give it to employees being fired fro poor performance or other reasons.

The important thing to know about a severance package is that it a contract in which you give up certain rights in exchange for some compensation. Namely, you are giving up the right to sue your employer for any reason.

If you are leaving the company on good terms and just being laid off, and if you have no reason you may want to sue your company, then a severance package is nothing but a good thing. However, if you have a dispute with your company, you may not want to accept a severance.