What does 'Severance package' refer to?

A severance package is primarily related to a redundancy payment, which typically consists of compensation given to an employee who is laid off as a result of organizational restructuring or downsizing. This package may include several forms of financial support, such as a lump-sum payment, continued health benefits, and sometimes additional support like outplacement services to help the employee find a new job.

This concept is significant because it provides the departing employee with a cushion to ease their transition out of the company and mitigate the impact of job loss. Companies may offer severance packages not only to support the employee but also to maintain goodwill and possibly avoid legal repercussions. The specifics of a severance package can vary greatly depending on the employee's length of service, company policies, and negotiations between the employer and employee.

In contrast, other options provided do not capture the essence of what a severance package is. A temporary job offer implies ongoing employment rather than a payment upon departure, a support program is too vague and can refer to various forms of assistance that do not specifically involve financial compensation for severance, and a performance bonus relates to rewards for achieving work-related goals rather than compensation for job loss.