Two-weeks Severance Pay Prevalent

October 4, 2001 (PLANSPONSOR.com) - Laid off workers, the casualties of a faltering economy, are likely to receive a minimum of two weeks salary in severance pay, with more senior and longer-tenured employees receiving larger packages, a new survey finds.

Result of the study by Lee Hecht Harrison show that 79% of organizations have severance policies, for which all full-time employees at all levels are generally eligible.

Two-thirds of those companies set minimum severance payouts, with:

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  • two weeks pay the median for non-exempt  employees
  • three weeks for exempts, such as managers, other salaried staff
  • four weeks for executives, senior executives, and officers.

Tenure

The research also shows that beyond the minimums, severance tends to be based on a formula including years of service, although the higher the employee’s level, the more likely severance will be negotiated or specified in an employment agreement.

When severance is based on years of service only, one week salary per year of service is typical for exempt and non-exempt employees. Two weeks per year of service is the median given to officers, senior executives, and executives, according to the survey.

Capping Payouts

Three out of five organizations put a maximum on severance payouts, with 26 weeks salary being the median cap at all levels except officers, who get 36 weeks salary.

In terms of outplacement, most organizations provide it to at least some employees, regardless of level.

Results were based on responses from human resources executives at 925 US companies.


 

Shortage of IT Professionals Increases

October 3, 2001 (PLANSPONSOR.com) - Despite the downturn in the economy, and the highest unemployment rate in almost four years, the average number of open IT service and support positions in US companies has more than tripled since 1999, according to research from the Computing Technology Industry Association (CompTIA).

The research found that the number of unfilled IT service and support positions is 2.1, out of an average IT department size of 25.6, representing a threefold increase from 1999 figures, which identified 0.6 open positions in average departments of 20.2 people.

Certification Preference

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IT certification plays an increasingly important role with CIOs compared to two years ago, with 51% citing independent IT industry association certification as important, compared to 41% in 1999.

CIOs ranked vendor-neutral certifications more important than vendor-specific certifications.
   
Despite the increased shortage, companies are more optimistic today than in 1999 about the availability of qualified IT staff.

This year, 51% of CIOs say the availability of qualified candidates for computer service and support jobs will improve greatly or slightly in the next two years, compared with the 43% who concurred in 1999.

The study, titled “The Ongoing Crisis in IT Management” study, which polled both CIOs and HR managers at companies with sales of $20 million or more, was conducted in May and June of 2001.

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