A special termination plan is a severance package offered to employees in an organization so as to facilitate their early retirement or separation from the organization. The present business scenario is full of stiff competition and shrinking margins making it virtually impossible for an employer to go on a spending spree and hire infinite number of employees.
With an ultimate aim of cost reduction and leaner business the companies have started offering their employees early retirement options bundled with attractive special termination plans so as to cushion the impact on the employee and make him opt for the severance package. This termination plan would essentially consist of special concessions, payouts, retirement benefits, stock options and privileges in order to facilitate the employee resign and start a new professional life smoothly.
This may also be done in order to retire older employees from the organization and retain younger and less expensive talent but in the end the ultimate crux of this whole exercise is cost reduction for which the employer is ready to even shell out one time hefty compensation packages.
[ Also Read: Employment Separation Agreements]
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