How To Calculate Severance Pay

Table of contents:

How To Calculate Severance Pay
How To Calculate Severance Pay

Video: How To Calculate Severance Pay

Video: How To Calculate Severance Pay
Video: Severance Pay Calculator 2024, March
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Severance pay is a guaranteed payment to an employee in the cases provided for by Articles 178, 81 and 84 of the Labor Code of the Russian Federation. The correctness of the calculation and the timing of the payment of this benefit are controlled by state bodies.

How to calculate severance pay
How to calculate severance pay

Instructions

Step 1

The basis for the payment of severance pay is the order of the head of the enterprise. The order specifies the article according to which the employee is dismissed, as well as the order on the payment of severance pay. The severance pay can be paid to the employee in cases not provided for by the legislation of the Russian Federation, or paid in an amount greater than that provided for by law. This must be stipulated in the employment contract with the employee or in the collective agreement of the enterprise.

Step 2

In order to correctly calculate the severance pay, you must: Know the paragraph of Article 178 of the Labor Code of the Russian Federation, according to which the employee is dismissed, since the amount of payment depends on this. For example, if the dismissal occurred due to a reduction in staff at the enterprise, then the employer is obliged to pay severance pay, the amount of which is equal to the employee's average earnings. And if the dismissal of an employee is connected with his conscription into the ranks of the Armed Forces, then the severance pay should be paid in accordance with the size of the two-week average earnings.

Step 3

Calculate the average monthly earnings of an employee who quits.

Step 4

Calculate the amount of wages that were actually accrued for the days worked in the billing period (the billing period is equal to the last 12 calendar months preceding the month of dismissal).

Step 5

Calculate the average daily earnings of an employee.

Step 6

Calculate the number of days actually worked by the employee in the billing period.

Step 7

Calculate the number of working days in the month following the day of dismissal.

Step 8

Thus, in order to calculate the severance pay, it is necessary to multiply the average daily earnings by the number of working days in the month following the day of the employee's dismissal. Average daily earnings are calculated by dividing the amount of wages that were actually accrued for the days worked in the billing period by the number of days actually worked during this period. It is important that sick leave payments and vacation pay are not included in the calculation of the average wage.

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