Back to Federal guidance
Severance benefits paid from general assets remain a welfare plan
Summary DOL advised that a severance program within the regulatory maximum was a welfare plan even when the employer paid benefits from general assets. The payroll-practice regulation did not classify every general-asset payment as a payroll practice; the conclusion concerns the described program.
Document
Federal opinion letter
Agency
U.S. Department of Labor, Employee Benefits Security Administration (EBSA)
Document number
P/OPINION 75-07
Date issued
November 5, 1975
Status
Unknown
EBSA's index does not mark withdrawn or superseded opinions; still posted on dol.gov as of 2026-10-26.
Status last verified October 26, 2026
Apply this to your situation
This page explains the general guidance. Ask about your specific situation and see what current federal labor law says, with citations.
About this page: The full text below is the official document from U.S. Department of Labor, Employee Benefits Security Administration (EBSA). Ezel adds the plain-English summary and tracks the document's status. The official source linked on this page is authoritative for any reliance.
P/OPINION 75-07
3(1)✓
3(2)
November 5, 1975
Dear :
This will confirm advice already given you orally
that a program providing severance benefits not in
excess of the maximum set forth in section 2310.3-2(b)
of the regulations published on August 15, 1975 is a
welfare plan even if benefits are paid from the employer’s
general assets.
As you pointed out, section 2510.3-1(b) of the same
group of regulations contains provisions distinguishing
payroll practices from employee welfare plans, and relies
in part on whether the benefits come from the general
assets of the employer. This section does not, however,
purport to make all payments from general assets into
payroll practices, but only those benefits which fit
the description in the regulations.
Sincerely,
What does federal law require in your situation?
Ezel checks current federal labor law against your facts and answers with citations.
Opens in Ezel Pro.
- Checks the law as it stands today, not only this page
- Cites every source it relies on, so you can verify it
- Chat, drafting and research in one workspace