Golden Parachute

A golden parachute is a contractual agreement between an organization and a high-ranking executive that specifies the benefits the employee will receive in the event of termination. A golden parachute package may include severance pay, retirement benefits, continued enrollment in pension plans, stock options, bonuses and paid health insurance. Golden parachutes have recently sparked controversy, as the packages have become larger over time and are paid to executives whenever they leave a company for any reason (including a dismissal or resignation in the wake of a scandal).

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