No legal requirement exists to provide severance pay, unless the employee has a contract with the employer that provides for severance. If the company does provide severance pay, eligible employees are those who are laid off or downsized, not those who leave voluntarily or were fired for cause. Employers must inform employees 60 days before a closing or mass layoff so employees have opportunity to find other work. Components of severance packages may include severance pay, outplacement, medical insurance, vacation pay, bridging to retirement or stock options.