How To Calculate Severance Pay On Dismissal

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How To Calculate Severance Pay On Dismissal
How To Calculate Severance Pay On Dismissal

Video: How To Calculate Severance Pay On Dismissal

Video: How To Calculate Severance Pay On Dismissal
Video: Severance Pay Calculator 2024, December
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The amount of severance pay upon dismissal depends on the reason for which the employee was dismissed (liquidation of the organization, layoff, etc.). It is calculated based on the employee's average monthly earnings. The payment of severance pay is governed by the norms of the Labor Code of the Russian Federation.

How to calculate severance pay on dismissal
How to calculate severance pay on dismissal

Instructions

Step 1

If an employee leaves in connection with the liquidation of an organization or a planned layoff, then his severance pay should include 3 average monthly earnings. According to the law, he must immediately receive 1 average monthly earnings, and also for another 2 months the average monthly earnings are retained for him. In addition, the employee is entitled to compensation for unused vacation time.

Step 2

An employee is entitled to an allowance in the amount of an average two-week earnings in the following cases: - if he refused to transfer to another job, which he needs in accordance with a medical report;

- if he was called up for military service;

- if an employee who performed this work earlier was reinstated;

- if the employee refused to move to another locality together with the employer;

- if the employee has not accepted the amended terms of the employment contract;

- if he was found to be incapable of work for medical reasons.

Step 3

In the event that an employee leaves of his own free will, he is not entitled to any severance pay. He only needs to pay compensation for the unused vacation. If an employee has worked in the organization for 11 months or more, then he will need to be paid compensation for the entire unused vacation (28 days). If it is less, then proceed from the calculation that for each month he worked there are 2, 33 days of vacation. Add up the vacation days he is entitled to and subtract the days he has already used.

Step 4

In order to pay severance pay, it is important to be able to determine the average earnings of an employee. According to Art. 139 of the Labor Code of the Russian Federation, the calculation of the average wage of an employee is based on the actually accrued wages and the actual time worked by him for 12 months. Example:

N. worked in the organization for 12 months. His salary was 30,000 rubles for the first 3 months, and 40,000 rubles for the next. To find out how much he earned in 12 months, multiply 30,000 by 3, and 40,000 by 9 and add up. Divide the received amount (450,000 rubles) by 12 months. In this case, you get 37,500 rubles.

Step 5

To calculate compensation for unused vacation, you will need to find out the average daily wage of an employee. To do this, divide the average monthly earnings by 29.6 (the average number of days in a month). Multiply the resulting amount by the number of vacation days that the employee did not use.

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