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A golden handshake is a clause in an executive employment contract that provides the executive with a significant severance package in the case that the executive loses their job through firing, restructuring, or even scheduled retirement. [1]
Some examples of severance pay to dismissed CEOs criticized as excessive include: Mattel's CEO who received a $50 million severance package after two years of employment despite overseeing a stock price fall of 50 per cent; $49.3 million payouts to Conseco's CEO, who left the company in "a precarious financial situation" [128]
Most definitions specify the employment termination is as a result of a merger or takeover, [1] [2] [3] also known as "change-in-control benefits", [4] but more recently the term has been used to describe perceived excessive CEO (and other executive) severance packages unrelated to change in ownership (also known as a golden handshake). [5]
For example, you might receive two to four weeks of pay per year of service. In a recent mass layoff at Google, workers received 16 weeks of pay, plus two weeks for every year of service.
According to Starbucks’ executive severance plan, ... In 2023, Narasimhan’s total pay package was valued at $14.6 million. Based on the company’s disclosures, the $10.6 million is what ...
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Severance packages are often negotiable, and employees can hire a lawyer to review the package (typically for a fee), and potentially negotiate. However, employees are never entitled to any severance package upon termination or lay-offs. [3] Severance packages vary by country depending on government regulation.
Negotiating a severance is likely a no-can-do even among the most valued service workers, for starters. Just imagine a star barista hitting up an indie coffee shop owner for six weeks' pay.
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