Reported New Severance Structure

Per HR contacts the new severance structure was approved in February and will be updated in HR resources by end of June before this year's large layoff rounds. The small number already impacted this year were under the prior structure.

The new severance structure is a staggered formula that includes in part tenure. In short the way explained to me it results in no severance for under 5 year tenure, less than the prior two weeks per year (around 1 to 1.5 weeks per year) for 5 to 10 year tenure, and around the regular two weeks per year. Also there is word they will be challenging unemployment claims for those receiving severance unless states legally allow both. Most states will require you to take the severance offer in lieu of unemployment if both are not allowed in a state.

Also severance is highly taxed and they state 22 percent but that is only for federal and does not take into account state and other deductions like FICA.

You will be paid out on earned PTO not used as normal. But it must be earned.

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Typically you have to pay back unearned taken PTO. Definitely if you quit. However they did waive this during last year's layoffs unless you took unearned PTO after your notice of layoff was given. But who knows how things will be handled this go around.

If I use ALL of my pto, even though I have not earned it, and I quit or get laid off- does Allstate deduct that from your last paycheck or severance check? I have heard they do and I have also heard they don’t make you pay it back! Does anyone know?

Except the tax part. Allstate has no control over taxes. Those are federally mandated.

Any word on when the first large layoff round for this year will be and areas impacted?

@lat.....yes, based on what was explained 10+ years would get around the standard 2 weeks pay per year capped at 12 months of severance. However with the formula is may be slightly above or slightly below the two weeks per year but it should average close to that.

What OP is saying is pretty spot on what I heard a few months back myself. Wasn't sure enough about what I was hearing to say anything. One of the biggest issues with the 2020 layoffs was all the double dipping that was allowed to take place. Some states it is allowed to get severance and unemployment but this is not the norm. Allstate had so many layoffs and so many of those also applied for unemployment in their states. Allstate was short staffed in HR after layoffs there that they failed to respond and dispute unemployment inquiries within an acceptable timeframe. Therefor many got severance and unemployment when they shouldn't really have. But at the same time the states were very overwhelmed by the mass increase in unemployment claims and filings from COVID that things pretty much ran amok countrywide. Some states are beginning to audit many unemployment claims for such instances and most states can audit this for 2 or 3 years after the fact so some repayment of unemployment may happen although with the pandemic it is hard to tell how strict they will be with these audits. Allstate really paid for severance AND unemployment for these laid off people as in most states the employer pays a certain percentage into the state unemployment claims in which they were the last employer for the unemployment applicant. A lot more was paid out by Allstate for the 2020 layoffs due to all this than originally planned. And with their real estate sales falling flat not that much money was saved compared to the plan and model used.

It seems to take away incentive from younger employees, who generally earn less.

So those that have over 10 years of service will still receive 2 weeks per year?

Thread regarding Allstate Corp. layoffs

Reported New Severance Structure

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