Voluntary Separation Package (VSP)

Definition

A polite way to say 'we're paying you to quit,' usually offered when layoffs are coming but they want to avoid calling it a layoff.

Example Usage

The company offered a VSP with two weeks per year of service, and half the department took it before anyone realized this meant layoffs were next.

Origin

Emerged in the 1970s as a 'gentler' way to reduce headcount

Fun Fact

VSPs are usually offered right before actual involuntary layoffs, making them a canary in the coal mine

Source: Separation Package Standards

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