Stellenabbau: So vermeiden Führungskräfte die teuersten Fehler bei der Abfindung

Düsseldorf – The removal of positions can easily lead to costly mistakes on the part of executives when it comes to severance packages. A chief marketing officer at a German insurance company was offered a severance package of over 700,000 euros, which appears to be a substantial amount at first glance. However, upon closer inspection, this is not necessarily the case.

At 55 years old, the manager earns a gross annual salary of 450,000 euros, plus an additional 50,000 euros per year contributed by his employer towards his company pension plan. Up until he can make his first non-penalized retirement at the age of 65, this would have amounted to around 500,000 euros. These entitlements are now forfeited with the termination agreement.

Moreover, after taxes, the manager is left with 360,000 euros in severance pay. Labor attorney Christoph Abeln, who specializes in representing executives, has seen numerous cases like this. He warns that "a hasty signature on a termination contract can prove to be costly." Even business-savvy executives often fail to recognize the significance of certain details.

It is not uncommon for executives to give away five- to six-figure amounts. The Handelsblatt highlights the importance of these details.