The standardisation plugs the scope of individual negotiations. Bansal's payout allegedly went way beyond what his contract specified. Kennedy's employment contract is said to have specified a severance pay of seven to eight months of fixed salary .

Co-founder N R Narayana Murthy publicly questioned these payments, as did several analysts. The board subsequently admitted that subjective elements had gone into determining the payouts and promised to make it more objective.

Infosys group HR head Krishnamurthy Shankar said the company has rationalised the employment contracts in the last six months. "It has nothing to do with compensation, it's just to ensure that the terms and conditions are consistent and in line with some of the regulations in different countries. It's a standard set of employment contracts for all senior management and executives," he said. The company declined to say anything specifically on the severance clause.

Earlier this year, Infosys said its interim CEO U B Pravin Rao (he was COO when the contract was revised) is entitled to a severance pay of nine months' fixed salary . Rao's severance benefits include payment of bonus. It's not clear if there has been any change in Rao's contract.

Severance pays are made only under certain conditions, such as if the company asks the executive to leave (provided that's being done not because the executive committed a fraudcrime) or if the company makes chang es that impacts the executive.

Pooja Ramchandani, partner & head of employment law at law firm Shardul Amarchand Mangaldas, noted that payment of severance to senior executives is often at the discretion of the employer. Ramchandani said an aspect of vital importance in case of separation of senior executives is the protection of the company's proprietary and confidential infor mation. Given that non-compete provisions are not enforceable beyond the contractual period unless it is in connection with the transfer of goodwill, other forms of safeguards need to be built in to protect the company's interest.

Ajay Raghavan, partner-labour & employment in law firm Trilegal, said while they have seen some organisations specifically include the manner of calculating the severance amount in the contracts for some senior level employees, most private companies leave this open-ended and negotiate the severance amounts at the time of the individual's exit.

Career management and talent strategy firm Right Management said in a report that in Brazil and Italy , severance pays are most frequently dictated by national and local laws, while in India, Sweden, Belgium and Switzerland, company policies are more likely to dictate severance policies.