SEVERANCE BENEFITS

OBJECTIVE

When it is necessary to involuntarily separate an employee for reasons unrelated to performance or conduct, it is the Commonwealth's objective to provide severance benefits as outlined in this policy.

I. EMPLOYEES TO WHOM POLICY APPLIES

This policy applies to the following full-time Executive Branch employees:
          1. .Employees whose positions are covered by the Virginia Personnel Act (section 2.1-110 et seq., of the Code of Virginia).
          2. .Other employees as defined below, whose positions are covered by the Virginia Personnel Act (section 2.1-110 et seq., of the Code of Virginia).

            3. a. Restricted employees whose positions are contingent upon project grants as defined in the Catalog of Federal Domestic Assistance are not eligible for receive severance benefits unless the funding source has agreed to assume all financial responsibility in its written contract with the Commonwealth.

            b. The Catalog defines project grants to include fellowships, scholarships, research grants, training grants, traineeships, experimental and demonstration grants, evaluation grants, planning grants, construction grants, and unsolicited contractual agreements.

          3. .Employees whose positions are identified by the State Council of Higher Education and the boards of the Virginia Museum of Fine Arts, the Science Museum of Virginia, the Jamestown-Yorktown Foundation, the Frontier Culture Museum of Virginia, the Virginia Museum of Natural History and the Virginia State Library and Archives, and approved by the Director of the Department of Personnel and Training as requiring specialized and professional training.
            (Revised effective 1/10/02)
          4. Employees of the Medical College of Virginia Hospitals and University of Virginia Medical Center.
          5. Administrative and professional faculty of state educational institutions (including presidents and teaching and research faculty) as defined in the Consolidated Salary Authorization for Faculty Positions in Institutions of Higher Education.

II. DEFINITIONS

A. Involuntary separation

Includes, but is not limited to, terminations and layoffs from employment with the Commonwealth, or being placed on involuntary separation or equivalent status, due to budget reductions, agency reorganizations, work force downsizings, or other causes not related to the job performance, misconduct of the employee, or voluntary resignations.

B. Eligible employees

Employees who are entitled to severance benefits.

III. SEVERANCE BENEFITS

The benefits below will be provided to those employees who are involuntarily separated from their positions.

A. Life insurance

The employee's agency will continue its contribution toward group life insurance for 12 months from the effective date of involuntary separation.

B. Health insurance

1. The employee's agency will continue to pay its portion of the employee's health insurance premium for 12 months from the effective date of involuntary separation. The employee is responsible for paying his or her share of the premium as directed by the agency.

2. An employee who wishes to change coverage should contact his or her Health Benefits Administrator.

C. Severance payments

    1. Based on years of service (see Attachment A for a total breakdown of severance weeks due to employees.)

    Eligible employees will be entitled to severance payments, paid every two weeks or twice per month depending on agencies' payroll practices, based on the following formula:

     
  • Years of Consecutive Service Amount of Benefit
    2 years or less 4 weeks' salary
    3 years through 9 years 4 weeks' salary
    plus 1 additional week for every year over 2
    10 years through 14 years 12 weeks' salary
    plus 2 additional weeks for every year over 9
    15 years or more 2 weeks per year not to exceed 36 weeks of salary

    •  

     

     

     
        1. Maximum benefit

          2. The maximum severance benefit to which an employee may be entitled is 36 weeks of salary.

        2. Partial years service rounded

          3. Employees with partial years of service will have that service rounded up to the next highest year for the purpose of determining the severance benefit. Partial years of service will not affect leave accrual or years toward service for retirement purposes.

        3. Severance monies cease upon reemployment with Commonwealth

          4. Severance payments will cease when an eligible employee is reemployed or hired in an individual capacity, or is hired as an independent contractor or consultant by any agency or institution of the Commonwealth during the time he or she is receiving such payments.

          D. Enhanced retirement benefits

          1. In lieu of receiving health insurance, life insurance, and severance money, any eligible full-time employee who is a vested member of the VRS, and who is at least 50 years of age, may elect to use the total value of these benefits to have the Commonwealth purchase years to be credited for retirement purposes to either the employee's age or creditable service, or divided between age and creditable service.
          2. The cost of each year of age or creditable service purchased shall be equal to 15% of the employee's present annual salary. The number of years of age or creditable service to be purchased shall be equal to the amount obtained by dividing the cash value of the severance money, health and life insurance benefits to which the employee would be eligible, by the cost of each year of age or creditable service. Employees interested in retirement are encouraged to contact their Benefits Administrator or the Virginia Retirement System for further information.

E. Reemployment Restrictions

The benefits cease if the person is reemployed, is hired as an independent contractor, or is hired as a consultant by any state agency during the time of receiving the benefits.

F. Unemployment compensation
          1. Receipt of severance payments does not automatically deny or modify an employee's right to receive unemployment compensation.
          2. Any employee who receives unemployment compensation shall have his or her severance payments reduced by the amount of the unemployment compensation. However, any unemployment compensation deducted from an involuntarily separated employee's severance payment shall be paid in a lump sum to the employee at the time the last severance payment is made.

EXAMPLE:

An employee who will be involuntarily separated May 1, 1995, is scheduled to receive $500 per week for 19 weeks. However, because the employee will receive unemployment benefits of $200 per week, the severance payment paid by the agency will be reduced to $300 per week ($500-$200). At the end of the 19 weeks, the employee will be paid for the total amount of these unemployment deductions or $3,800 ($200 X 19).

IV. AUTHORITY AND INTERPRETATION

        1. This policy is issued by the Department of Personnel and Training pursuant to the authority provided in Chapter 10, Title 2.1, of the Code of Virginia.
        2. The Director of the Department of Personnel and Training is responsible for official interpretation of this policy, in accordance with section 2.1-114.5(13) of the Code of Virginia. Questions regarding the application of this policy should be directed to the Department of Personnel and Training's Office of Policy and Personnel Programs. The Department of Personnel and Training reserves the right to revise or eliminate this policy as necessary.

Attachment

Policy 1.57

WEEKS OF SEVERANCE BENEFITS
WHEN SEPARATED INVOLUNTARILY

The chart below computes the number of weeks of severance pay due to employees based on their years of service when they separate.

Years of Service Benefit (Weeks of Salary)
2 and under 4
3 5
4 6
5 7
6 8
7 9
8 10
9 11
10 14
11 16
12 18
13 20
14 22
15 30
16 32
17 34
18 and over 36

Partial years are rounded up to the next year. The benefit ceases if the person is reemployed, is hired as an independent contractor, or is hired as a consultant by any State agency during the time of receiving the benefits.