Yahoo offers severance with a soft landing

A pink slip for corporate America's newly laid off typically means a severance package and a "see ya."

But when Yahoo issued its layoff notices to 10 percent of its workforce on Wednesday, it came with a twist, according to several sources.

Yahoo's 1,520 pink-slipped employees will remain on the payroll through February 13, retaining the ability to continue vesting any options that may come available through that separation date. Vacation accrual, however, will not apply, noted one source.

By the same token, those laid off employees will be "on call" to answer any questions that those who will be taking up the slack may have, to a certain extent anyway.

For those folks who have not landed a job by February 13--which in this recessionary climate may be many--nor bad-mouthed the company, will be entitled to an additional lump sum payment of two, three, or even four more months of severance, sources say.

And on top of that, an additional one month of severance will be awarded for every five years of service at Yahoo, sources note.

[alegr]

I believe it's because the law makes them to keep those people for 2 months, not because of good will.

[servermaker]

really? Which law? This is not Europe.

[wjsteele]

What law? Those employees are more than likely "Work for Hire" which means that Yahoo can do what ever they want... there is no law that forces Yahoo to pay them an additional two months after a layoff.

[jraroque]

@ wjsteele
What you are saying is true to fire an individual. However, when a company lays offs some percent of its workforce (I think >5%), they are required to give two months notice. Since productivity nosedives (are you really going to work hard knowing you can't be fired again and they have to pay you) most companies will simply let people go and just pay their salary for the two months.

[friday04]

@jraroque

My company let go of 9% of its workforce and I was one of the unlucky 115 let go. We didn't get 2 months of notice. We found out on Thursday that the layoffs were coming and the following Tuesday I was walking out of the building with a box. They gave very generous severance packages but they didn't have to. There's no law dictating severance nor notice of job termination.

go research the WARN Act! The 60 days is a legal requirement if companies lay off over 50 is one lay off. Plus, the company has to notify the dept of labor about the upcoming lay off -

"California's WARN law requires certain companies with more than 75 employees to provide 60 days advance notice of a plant closing or mass layoff involving 50 or more employees." Or, in lieu of warning - just give the impacted employees 60 calendar days pay - which is the probably the norm. Companies don't want impacted employees hanging about getting up to mischief.

[humanssssss]

WARN act has several exceptions. When your revenue is unexpectedly decline due to business climate condition. You do not need to provide 60 days notice. When a group of employees decide to strike and it impacted your business, you do not have to provide 60 days notice. When a group of employees refuse to perform at their best, you don't have to provide 60 days notice.

WARN only affects normal, expected operation of a company that's not beyond what is unexpected within their power.

[Whootowl]

They need to stick around for awhile in order to train the H1-Bs that are coming in.

[flickrz]

What crap! Lay offs are universal. A friend of mine who is on H1B also got laid off from yahoo. Just take your bigotry some where else.

[JoeF2]

And yet another xenophobic idiot.
You obviously have no clue whatsoever how the H1 works. New H1s can only start Oct. 1. A bit late for Yahoo, eh?
So, keep your xenophobic BS elsewhere, and go back to your cave, troll.

[Whootowl]

No bogotry, just economic reality. When the going gets tough, cut expenses.

[rpvitiello]

US fed law is if a company with over 100 employees has a mass layoff they need to either pay 2 months severance, or give 2 months notice of the layoff. So yes they do have to pay them for 2 months at least no matter what. Anything beyond that though is them being nice.

[flickrz]

It is a law in California that requires 60 day advance notice in case a company lays off more than 50 employees from its work force. The generous severance package is a cushion for those unfortunates who got laid off in this hard economic times.

[Penguinisto]

Damn.

No, seriously - that's the most generous layoff package I'd ever seen out of a US corporation.

[LRCasey]

This is a pretty standard package for the layoffs I am aware of in the Silicon Valley (by companies other than startups that crashed).

[VOMIChairman]

What Next?

What will happen next to all these people who are being laid-off? Will they ever get back a similar or better paying job? If so, when? If not, do they have transferable skills that could allow them to make a successful transition to another occupation that offers equivalent or better pay and, therefore, allow them to maintain or restore their previous standard of living? Or will these individuals be relegated to a permanent underclass or incognito status?

The full article titled "Job Losses at Their Highest Level, Virtual Organize Your Social Network Now!" is available at:

[Editor's note: Inappropriate content removed]

[myles taylor]

What I don't understand is if Yahoo can afford this (this is great BTW), why can't it afford to keep those employees on for another few months? Instead it's paying them and not getting anything in return except goodwill (which is good). Why don't they instead put those employees to good use, maybe dive into another market, do something else. I'm not sure what, but it seems like they are spending money with nothing in return.

[JoeF2]

It's the law...

Doesn't sound much different from any of the other big high-tech companies. The 60 day notification is a legal requirement i.e. the WARN Act. The rest of the severance is similar to what Sun Microsystems has offered in its RIF package for years. Nothing special going on here. Sun covers a couple of months COBRA gross-up as well. Pretty important in these economic times

If the Yahoo! package is deemed generous, as some have noted, I'd be pretty depressed about what their respective companies may have offered.

[Zandora777]

This is standard stuff, for the most part. I was recently laid off from a major silicon valley company, and they gave me 60 days to remain on payroll, but immediately took my badge, phone, and computers, and relieved me of all work responsibility. What they did NOT do however, which I think many people are missing, is to give you MORE severance if you don't find a job at the end of that time, which is pretty remarkable.

[Whootowl]

Not many H1s will be let go. Yahoo will let go their more expensive dead wood.