Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/20116
Authors: 
Grund, Christian
Year of Publication: 
2003
Series/Report no.: 
IZA Discussion paper series 875
Abstract: 
This contribution investigates severance payments for dismissed employees in Germany. Subsequent to an overview about the legal framework, we respond to the following questions: Who receives severance payments? By which characteristics is the level of severance payments determined? Is overcompensation to be considered a relevant issue? Hereby, individual and collective dismissals are always distinguished. This is the first study on this issue using individual representative data – the German Socio-Economic Panel – and multivariate methods. The results indicate that rather women, persons with many years of tenure and working in big firms receive severance payments. There is a huge variance in the size of the payments, which can only partly be explained by tenure, the wage, firm size and the region. At least one quarter of dismissed employees is better off in their following careers independent of having received a severance payment.
Subjects: 
severance payments
dismissals
plant closings
JEL: 
M51
J53
J32
M52
Document Type: 
Working Paper

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