severance pay benefit

The eligibility requirements are the same for all participants, including those who participate in and are accepted for an Expression of Interest (EOI) and for those who are left standing from a selection event without an EOI.   

An Eligible Employee under the SESP must meet these general requirements:

• You must be PSG 30 or below.
• You must be an active participant in the Chevron Retirement Plan. 

In addition, you must also meet the following requirements:

• Be in an organization, location, function, or classification that has adopted the SESP – this is commonly referred to as being in-scope.

• Receive formal written notice from Chevron that your employment will be involuntarily terminated (left standing) or that you are being offered a demotion. This notice will also confirm you are eligible to participate in the SESP. This formal notification is often referred to as your severance notification.

• You must properly complete and sign – within the time limits set by Chevron – a Settlement and Release Agreement and you don’t revoke it within the seven-day revocation period.

These are eligibility highlights only. Chevron retains the right, in its sole discretion, to determine who is an eligible employee. Consult the applicable summary plan description (SPD) for further details.

You are not an Eligible Employee under the SESP if:

• You’re a Temporary, Casual, Seasonal Employee or Professional Intern.

• You’re on a Leave of Absence without Pay at any time while the plan is in effect.*

• You qualify for severance pay or similar benefit under another plan or policy sponsored by Chevron.**

• You’re covered under a collective bargaining agreement, unless participation in the SESP is agreed to by your collective bargaining representative.

*Exceptions: You’re on family leave, military leave, or you return to work before the end of the plan’s effective period.
**Reminder, legacy PDC Energy employees remain eligible for the PDC Energy Employee Change of Control Severance Plan through August 7, 2025. 

It’s also important to understand how you lose eligibility for the SESP.

Your participation in the SESP will end if any of the following occurs:

• You voluntarily end employment with Chevron for any reason prior to the termination date Chevron has set for you.

• You receive a written job offer from Chevron that is not temporary and not a demotion.

• You remain employed by Chevron after December 31 of year following your initial notification. (In other words, your employment must terminate within 365 days from the end of the plan’s effective date.)

• Your Chevron employment is terminated for cause.

• You voluntarily end employment with Chevron to accept employment with an organization that is wholly or partly owned (directly or indirectly) by Chevron or an Affiliate.

• You die before your employment with Chevron is terminated.

• Chevron informs you that you are no longer eligible to participate in the plan.

It’s also important to note that you aren’t eligible if you have already received a Severance Pay Benefit under the SESP plan.

HR Policy 305 - Services of Former Employees defines the limitations on re-employment with Chevron. To avoid a risk of tax consequences to the Chevron Retirement Plan, Chevron assesses each rehire situation - whether as employee or contractor - based on individual circumstances. Key considerations that are assessed include:

• If you received a distribution from any of the retirement plans.

• How long you have been separated (at a minimum you must be separated for six months).

• Your work schedule, preferably working less than 50% of the average time worked over the 36-month period before termination.

• You can be rehired as an employee or retained as a contractor, without limitations, if returning after three years from termination.

The Severance Pay Benefit under the SESP Plan is a taxable benefit paid in a single lump sum. Read more about the payment formula in the applicable plan's summary plan description (SPD).

To assist you in your decision making, you can access personalized information to help you estimate your Severance Pay Benefit prior to leaving Chevron.

• Read the instructions here. (intranet access required)

Your Regular Earnings are used in the calculation of your Severance Pay Benefit. 

• To calculate your Regular Earnings, review our detailed instructions.

In general, Regular Earnings are your straight-time wages or salary paid for your regular work schedule (or a leave of absence with pay).

• It also includes any before-tax contributions you make to Chevron's benefit plans.
• Your Regular Earnings do not include overtime or pay for work outside your regular work schedule.

Your number of years of SESP Service is used in the calculation of your Severance Pay Benefit. To locate your SESP Service date, review our detailed instructions.

For most employees, SESP Service is based on your years of service since your most recent hire date. 

• SESP Service and Health and Welfare Eligibility Service (HWES) are not the same and may recognize different periods of service.

• Only service that occurs after your most recent hire date with Chevron or a wholly-owned Chevron subsidiary is credited as SESP Service. So, for example, employment service with joint ventures is not taken into account under the SESP Program to determine eligible severance benefits.

• Your severance pay benefit may be reduced in certain circumstances, such as for part-time work.

• Your years of SESP Service as of your actual termination date will be used for the final calculation of any severance benefits. 

Read more about SESP Service in the applicable summary plan description (SPD).

When you terminate or retire, your active employee payroll preference - direct deposit or physical check - on file in Workday remains in place. Your severance payment will be made consistent with this payroll preference.

• If your preferences are still accurate and acceptable, no action is required.
• If you need to change these preferences for post-employment payments, submit the Direct Deposit for Former Employees form.

If you have payroll-related questions after you’ve left Chevron - such as how to get a pay advice or final pay inquiries - please use the payroll contact specifically for former employees.

See the Payment Process Overview section on this page for a recap of the payment process, including what to expect and what you need to do to remain eligible to receive the severance pay benefit.

Upon completion of all payment process requirements, your severance payment will be processed. It generally takes 1-2 payroll cycles after the revocation period ends to process your payment.*

*If you are a Specified Employee (pay scale group 30 or above), as defined in the summary plan description, your severance payment will be processed no earlier than generally the first day of the seventh month following your termination of employment date.

• Your Severance Pay Benefit is regarded as supplemental pay and is subject to income tax withholding in the year received. Chevron will deduct any and all taxes necessary to comply with legal requirements, including mandatory U.S. Federal income tax, Social Security tax and State and local withholding taxes. Your benefit is taxable in both work and resident locations, if different.

• Your Severance Pay Benefit is not benefits bearing. This means medical, dental and other benefit deductions are not withheld and the severance amount does not influence the amount of pension, savings or other benefits.

• If you owe any debt to the company (such as cash advances, payroll loans, or foreign tax loans) the amount of your benefit will be reduced by the amount of the debt, and your debt will be extinguished by the amount of the reduction.

Update your tax preferences in Workday, if you're still an active employee with intranet access. If you no longer have Chevron intranet access, please use the payroll contact specifically for former employees.

• There is no option to defer the timing of your payment to the following tax year.
• There are no alternate forms of payment to choose.
• Your benefit is not eligible for rollover to a traditional IRA or other qualified retirement plan.
• Severance payments made January 1 or later fall into the new calendar year’s income for tax reporting purposes.

Tip: The only control you have in the timing of your benefit payment is when you submit your completed Release within the 60-day response period after your termination of employment. The date you submit your completed Release is when the 7-day revocation period begins. Your payment is then processed within the next 1-2 payroll cycles after the revocation period ends. In the event that your 60-day review period does not end before December 16 or if the Release waiver is returned after December 16, then payment will generally be made in the new year. 

If you are retained as or through a contractor or rehired by Chevron within one year after termination, you must repay all, or a portion, of your severance pay benefit (if any was received) as a condition of being retained or rehired.