Severance and Workers' Compensation: Understanding Your Rights

Workers' compensation is not limited to providing for an employee's medical bills. Workers' compensation also includes a form of compensation for disability, past and future economic loss and compensation for the death of the employee. If an employee suffered an accident while on the job and became permanently disabled because of it, the employee might not be able to return to his/her former position in the company. Workers' compensation would offer a package for the employee for the loss. Workers' compensation is required by law when there is workplace injury involved. However, a severance package is an option for most companies to offer its workers when the company needs to terminate its employees.