“Severance pay” is the gross amount of severance pay including severance pay that is contingent on the employee signing a release of liability or waiver agreement, dismissal pay, pay instead of notice of termination, wage continuation, or other remuneration paid or payable to the claimant upon separation from employment. Deducting Severance Pay. Severance pay shall be deducted from benefits. The Secretary shall allocate severance pay that is paid in a lump sum or in increments to a number of weeks following the date of separation, including the week during which the claimant was separated from employment. The Secretary shall allocate severance pay by: Calculating the entire amount of severance pay including any amount of severance pay that may be contingent on the employee signing a release of liability or waiver agreement; Calculating the claimant's daily wage by dividing the claimant's last weekly wage by seven; Calculating the number of days to which the severance pay applies by dividing the total amount of severance pay by the claimant's daily wage; and Applying the severance pay to the days immediately following the claimant's last day of service. If severance pay allocated to a particular week is less than the claimant's weekly benefit amount, the claimant shall receive the difference. Severance Pay Reportable and Taxable. Severance pay is reportable and taxable for the purpose of the employer's contribution obligations under the Unemployment Insurance Law.