I read somewhere that the severance relates to the wages the month after players have been released. If a player doesn't get fixed up the releasing clubs have to pay a months wages and vice versa if they do. I also think that if a player is on a lesser wage the releasing club makes up the difference for July. Bradford City were not happy with York City as York signed Clayton Donaldson from August as opposed to July to save the months wages. Bradford argued that York had released the fact that Donaldson had signed a deal, paraded the new signing even though his contract doesn't start until August.