<aside> <img src="/icons/token_blue.svg" alt="/icons/token_blue.svg" width="40px" /> **You’re looking for…**an approach to handle necessary staff transitions that's clear and compassionate while preserving dignity and organizational relationships.
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TL;DR: Generous severance packages honor your departing team members while protecting your organization. Offering 2-3 months salary with benefits creates a financial runway that allows for honest conversations and dignified transitions. This approach costs less in the long run than keeping someone in the wrong role and builds trust throughout your organization.
What's in it for you (WIIFY):
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Important Note: I am not a lawyer or HR professional. This is not legal or HR advice - it's an approach I've found helpful over many years of leading teams. Always, always, always(!) consult with appropriate legal and HR professionals before having these conversations.
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Let's be honest about the financial reality - we are all living and working in a capitalist society where our worlds often rely on us being employed.
A quick note on capitalism - Not necessarily a fan, especially of late stage capitalism(!), and it is the system we are operating in. I believe how we honor this arrangement and support each other matters.
All employer-employee relationships are fundamentally based on an employer offering a set amount of money for an employee to work and that employee accepting said money for the work. Such a simplistic way of seeing it that doesn't capture anything about the power dynamics and dysfunctions of our society - and it's also true.
I often hear folks talk about work as family and, in my view, it isn't. It's much less complicated. Work is about moving the organizations' purpose forward - and we all sign up to be part of it. We can absolutely be family - biological and chosen - beyond the office. And we can choose to ground how we treat each other and run our company with heart and integrity. But when work isn't happening as needed, we're not honoring our foundational employee-employer agreement - and that's not fair to anyone.
I’m a BIG believer in generous severance, especially as part of an Opt-in conversation. This approach gives people runway and reduces the stress so they can make an honest choice. It also communicates respect and recognizes the real human impact of these transitions, honors their contributions - and acknowledges that everyone was part of things not working! As we all know, misalignment rarely falls on one person's shoulders alone.
Yes, this is an investment and your budget likely feels tight. And I’d argue that keeping someone in the wrong role costs more - in team morale, lost productivity, and missed opportunities. By giving folks financial support to transition to their next thing and find a role they are excited about, you are ensuring this individual has a better foundation AND that your current team can deepen their trust in how you manage these conversations.
I’ll also note, what we generally do is drag our feet - throwing money and time at trying to solve something for months before having an Opt-in convo. This isn’t serving anyone involved. How much more beautiful and straightforward to have the Opt-in conversation earlier and then focus on the work. And allow this employee to focus on aligning to what’s needed OR to be supported in their next opportunity.
In general, I offer 3 months salary + health insurance. This can absolutely vary based on seniority, length of tenure and organizational budget. And, when I do the math, paying someone and moving on is almost always more effective and economical. There are times where I structure this with a few final deliverables for the person or a slow transition (e.g. they announce they’re leaving while we hire and they look for a new role). Trust yourself on what will work best in any given situation -and remember that clean is almost always better!
When designing a severance package, start with these foundational elements: