Leaving Shell – Severance

Full Transcript:

John and Jane are leaving Shell. Let’s talk about what their severances could look like.

Let’s continue chatting about leaving Shell and talk about severance packages. Generally, Shell has offered special services during reorgs, but please refer to your updated severance offering guide and HR regarding your unique situation. To talk about what a severance package could look like, let’s look at two hypothetical scenarios. Let’s look at John and Jane.

John is 40 years old, and he has 15 years of service with Shell. John’s base salary is $200,000. Now, we’re going to assume that John’s severance package includes three weeks of pay per year of service. So, therefore, we multiply three times 15 times John’s weekly salary. And by doing so, we would come to a severance payment of $173,000. Now, if John left Shell with the severance in October, the severance would then pay out in November.

Now, let’s look at Jane. Jane is 50 years old and Jane has 25 years of service. Jane’s base salary is $305,000. Now, we’re going to assume that Jane’s severance package includes the same three weeks per year of service as John’s does. So, therefore, we multiply three times 25 times $305,000 divided by 52 to get to weekly salary, which then yields a severance payment of $440,000.

Now, what’s unique about Jane versus John is Jane qualifies for immediate pension eligibility with a special severance package. This is because with a special severance, she has at least 70 points, she’s attained at least age 50, and she has at least 20 years of service with Shell. Because Jane qualifies for Shell retirement, her severance payment is broken out into two payments. So, if she leaves in October, her first payment is in November, and then she also gets another payment the following February. When you get a severance payment with Shell the IRS is going to take their chunk of it. Now, by splitting it out over two years, hopefully, they take just a little bit less.

Now, this is just one of many payments that you’ll receive after leaving Shell. Stay tuned for future videos to hear about the other payments that you could receive.