Downside to taking severance package before school?

Don't do it. You don't want a potential employer to do a background check and see "terminated" as opposed to "resigned." The severance package would be nice, but stick it out as long as you can. You'll be better off in the long run.

The bank that I work for just laid off 100+ people today and gave them very nice severance packages. It sounded sweet, but I did not want to have any bleak spots on my record just for 2 months less of work before b-school.

This is my take on it. I'm more of an immediate benefit guy and would take the severance package. However, work out an understanding with your boss that you are doing a favor to the team/department and that you will need the favor returned when it is time to provide a reference - list him/her. Use it as a strength.

Looks like I am in the minority, but don't think it should have much of an effect.
I never had to go through a bg ckeck, but I don't think my company can disclose anything to an inquiry except that the person indeed was employed between certain dates. I don't know if that's our legal dept. trying to scare everyone or that indeed is the practiced everywhere. You can always disclose that you took a severance package and saved a job spot for your team mate if you end up having an interview. Employers usually do not check ALL resumes they receive.

I am sure you are working your tail off right now, so taking a few months of break will benefit you. Will save a job for your colleague, and will help your company handle the matters in a nicer way. I can't see a recruiter who would not understand that.

Moreover, it is very hard to lay a person off for performance reasons - it is rather restructuring that cuts positions, departments, and results in lay offs. I know a number of companies that tried to lay somebody off and it took months to collect information, reports, etc, and eventually all it did, was convince the person to resign. So, any HR person will know that only a small portion of poor performers are laid off (most don't get into Michigan MBA program - Harvard instead), and of those laid off, only a small portion are poor performers.

I would take the package, in fact I was hoping for something like that in my company but I dont think I will be lucky enough. I dont think the downside is much, if anything at all. As far as I know, it should not really impact your "hire"-ability post MBA- if it did, pray for all the bankers getting laid off right now. Also, I agree with bb- you should be able to negotiate it with your company.

Good luck!!!

I'm agreeing with bb and dosa don... I dont see any downside. I also think that companies are not really allowed to give out the information of fired or quit, they can only give information stating that you were employed from certain dates. Plus, you are taking one for the team, letting someone who doesn't want to, or doesn't plan to leave, the opportunity to stay. All systems go if you ask me.

I agree -- you were not terminated, you voluntary took severance. Its easy to explain if it comes up in a check -- even though I think it wouldn't... In general, what companies can say during a reference check is very limited. Dates of employment, salary, title.... and in some cases whether or not you are "eligible for re-hire".

I'd take it. Make it seem like you are making a sacrifice for the team because its the right thing to do, and keep that ace in your pocket.

dj, I dont think there is anything on a background check that says terminated or otherwise. I will surprised if companies give out that kind of info about former employees.

bherronp, I think you should just take it. There are just many things you can do with this time : volunteer, brush up on B-school related stuff like accounting, stat etc, research the career you want to be in and actively network with alums on that area, vacation (oh, yeah!) and so on.

If you have questions, reach out to Ross alums in your target companies and see if this will be a blot in your profile.

yep and the timing is perfect.
When I got admitted, I actually quit end of June and took a whole month to relax and unwind since my work was very involved and I was very exhausted working long hours. Then there was some time to prepare for the move and settle in, etc. I definitely would not be ashamed of the situation.

I think this is a correct statement. Exhibit due diligence by asking HR that if you voluntarily resign, will the "termination" show up in your background check.

I think Kroll verifies that you worked somewhere and the dates worked there...not the conditions under which you left the company.

Use those 2-3 months to do something big that will improve your resume.

I would take the severance pay to save my co-workers if I had any even a hint of love for them.

jfals
https://www.jaredmalan.com

taaake it !!!

i can't see any downside. Gee i wish it something like that can happen to me right now, i REALLY need that money.

Since it is weekend, I will be funny - The only better situation I can envision is a mandatory eviction (usually prior to sale or demolition of a building or sometimes if management changes). In that case, depending on the state, the landlord has to pay the renter back a full deposit as well as $3-7K for relocation expenses.

Coincidentally, yesterday, I spoke with a frat brother of mine who graduated from HBS a few years ago. He works for a startup that just went public, so kudos to him. We were just catching up, and he mentioned that he was laid off early on in his career. Well, it obviously did not affect him because he found a good job afterwards and then he got into HBS.

However, I asked him, for the benefit of GMAT Club , how it affected getting jobs in the future. He said that it essentially did not affect him. The reasons for that are he was laid off with 25 other employees in his entering class, so it was a situation that no matter how good he was or wasn't he was getting laid off. However, he had to explain that, which is the part that I do not like. If an employer asks, you are going to have to say that you were voluntarily laid off. That could, however unlikely, be misconstrued, and are you comfortable with that possibility? If you resign, then when, or if, an employer asks why you left, you can mention that you resigned and that's that.

But, as I said before, he dealt with the uncomfortable answer when he was on job interviews, and he obviously pulled through. I think it comes down to what you are comfortable with personally. I, after having made it through two layoffs this year, like to tout the fact that I survived; but, for others, they might prefer the severance--which is completely understandable, don't get me wrong! Your choice.

I would definitely take the severance package. Even if you are a strong contributor to the company, you aren't going to be there for much longer. (2-3 months?). The other employees will probably appreciate that as well.

If anyone in the future asks, I really can't see how they can count the voluntary resignation against you. You were going to business school anyway, right? Now after you resign though, don't just sit on your ass playing XBOX all day. Do something worthwhile, maybe some community service, learn something new, go to Vietnam and teach some kids English or something.

If a future employer asks, tell them what happened. You accepted a voluntary layoff because your were leaving for business school anyway and it was best for you and fair to the other employees and company, and after you resigned you didn't sit on your ass playing XBOX all day. Done and done!

Thanks for your thoughts everyone. Many of you seem to think similarly to my train of thought.

I obviously do not want to do anything that could endanger my future for internship and FT positions. However, I feel that it is unlikely that volunteering to accept a severance package this close to when I would have left for bschool anyway would do so. I don't think the actual separation date will be until mid June if it happens. My performance reviews have all been excellent, and my current and recent managers are all willing to give me strong references if necessary, so I feel pretty well defended in that regard.

Either way, if it comes down to it and someone from my team has to be laid off, I will volunteer whether or not it could have an impact to recruiting. I will not fight to keep a job I had planned on leaving soon anyway at the expense of one of my teammates.

It shouldn't be an issue with at all.

What I would give for a severance package right now...

To quote my character on my favorite show...

"I declare this to be the summer of George!"

Can't see why it would be an issue, and you can really spin it as being a team player - you know you are going in a few months, so if they are looking to reduce numbers I would think it better to leave now for the sake of others. You could spin that so well in some interview questions for different roles.