Foreign financial firms fired some 4,300 staff in Japan in the 15 months through March, according to Bloomberg. But hold back your tears: the Financial Times is reporting that lots of those deemed surplus to requirements are getting handed their pink slips along with bumper severance payouts.
Near the top of the list of generous axe-wielders is ING, who was offering employees 15 to 20 months’ severance pay last month in its attempts to cut about 250 positions in Japan.
Other firms, the FT says, are even splashing cash on international school fees and luxury expat apartments for their ex-employees.
But a senior Tokyo-based recruiter, who wished to remain anonymous, says three to six months’ severance pay is typical for foreign firms in Tokyo.
“I hear from a reliable source that Citi is currently offering six months’ severance. However, Japanese companies tend to pay more. I’ve heard that they tend to offer one month for every year of tenure on average above a certain minimum package,” he adds.
The headhunter adds that Shinsei, who will merge with Aozora in October 2010 to create Japan’s sixth-largest bank, has been offering even bigger redundancy packages than ING to its more senior employees.
But what of the other severance perks? None of the recruiters contacted for this story had heard of firms including accommodation allowances or school fees as part of their severance packages, but didn’t discount the possibility.
“It really depends on the individual, tenure, seniority, and other factors,” says the anonymous recruiter.