163. When determining the amount of severance payments to be made, the investment firm should take …

When determining the amount of severance payments to be made, the investment firm should take into account the performance achieved over time and assess where relevant the severity of any failure. Identified failures should be distinguished between failures of the investment firm and failures of the identified staff as follows:

• a. failures of the investment firm should be considered when the total amount of the severance payments for staff is determined, taking into account the capital base of the investment firm; such severance payments should not be higher than the reduction of costs achieved by the early termination of contracts;
• b. failures of identified staff should lead to a downward adjustment of the amount of severance pay which would otherwise be awarded when only the performance over time would be considered in the estimation of the severance pay, including the possibility for a reduction of the amount down to zero.

1. Overview

1.1 References

1.2 Identified Requirements

1.3 Related Standards

2. Identified Requirements

3. Related Standards

• EBA - Published by the European Banking Authority at https://www.eba.europa.eu/