Severance Pay Calculator

The severance pay calculator helps you estimate how much money you may receive after being let go from a job. It takes into account various factors like years of service, age, and salary.

How to Use the Severance Pay Calculator

Using a severance pay calculator is simple. Just fill in few basic details:

• Annual basic salary: total salary you earn in a year before taxes and deductions.
• Years of service :total number of years you have worked at your current job. This should be rounded to a whole number. E.g If you've spent 9 years and 8 months, type 9.
• Age: Select your age from the dropdown. The age has been simplified into years and months to accurately apply the age factor in the calculation.

Once these values are entered, the calculator gives you the result. Keep in mind that not all employers are required to offer severance, but when they do, these factors usually come into play.

Interpreting Your Results

After entering your details into the calculator, the tool provides five key results to help you understand your estimated compensation:

• Basic Severance Pay: This is the base amount calculated based on your years of service and salary.
• Adjusted Severance Pay: This includes any age-based adjustments, which may increase the base amount.
• Total Severance Pay: This is the final estimated payout, a combination of basic and adjusted severance (and sometimes other entitlements).
• Biweekly Severance Pay: This shows how much the total severance pay equals when spread out over typical biweekly payments.
• Number of Weeks: This shows how many weeks of pay you are being offered in total.

These figures give a clearer picture of what you might expect, either in a lump sum or over several payments.

How Severance Pay Results Are Calculated

How Is Basic Severance Pay Calculated?

The Basic Severance Pay depends on your years of service and is calculated using two methods:

• If you have worked less than 10 years:
  You are entitled to 1 week of pay for each full year of service.
• If you have worked more than 10 years:
  The calculation is split into two parts:
  • The first 10 years count as 1 week of pay per year.
  • Any additional years beyond 10 are calculated at 2 weeks of pay per year.

Example:

Suppose an employee has worked for 13 years and earns $52,000 annually

• ($52,000 / 2,087) x 40 = $996.6459
• First 10 years: 10 years × 1 week = 10 weeks of pay
• Additional 3 years: 3 years × 2 weeks = 6 weeks of pay
• Basic Severance Pay: $996.6459 x 16 = $15,946.3344
• Biweekly severance payment : $996.65 x 2 = 1993.2918

How Is the Adjustment Based on Age Factors?

Some employers or jurisdictions apply an age factor multiplier to the basic severance pay. This is meant to provide additional support to older employees, who may face more challenges finding new employment.

The Adjusted Severance Pay is calculated by multiplying the basic severance amount by an age factor.

Full Year of Age	0 to 2 Full Months of Age Factor	3 to 5 Full Months of Age Factor	6 to 8 Full Months of Age Factor	9 to 11 Full Months of Age Factor
40	1.000	1.025	1.050	1.075
41	1.100	1.125	1.150	1.175
42	1.200	1.225	1.250	1.275
43	1.300	1.325	1.350	1.375
44	1.400	1.425	1.450	1.475
45	1.500	1.525	1.550	1.575
46	1.600	1.625	1.650	1.675
47	1.700	1.725	1.750	1.775
48	1.800	1.825	1.850	1.875
49	1.900	1.925	1.950	1.975
50	2.000	2.025	2.050	2.075
51	2.100	2.125	2.150	2.175
52	2.200	2.225	2.250	2.275
53	2.300	2.325	2.350	2.375
54	2.400	2.425	2.450	2.475
55	2.500	2.525	2.550	2.575
56	2.600	2.625	2.650	2.675
57	2.700	2.725	2.750	2.775
58	2.800	2.825	2.850	2.875
59	2.900	2.925	2.950	2.975
60	3.000	3.025	3.050	3.075
61	3.100	3.125	3.150	3.175
62	3.200	3.225	3.250	3.275
63	3.300	3.325	3.350	3.375
64	3.400	3.425	3.450	3.475
65	3.500	3.525	3.550	3.575
66	3.600	3.625	3.650	3.675
67	3.700	3.725	3.750	3.775
68	3.800	3.825	3.850	3.875
69	3.900	3.925	3.950	3.975
70	4.000	4.025	4.050	4.075

Source: US office of personnel management

Example:

Let’s say the basic severance is 16 weeks (as in the example above), and the employee is 55 years and 3 months old. According to a common scale:

• Age 55 years 3 month: Age factor = 2.525
• Adjusted Severance pay = 15,946.3344 × 2.525 = 40,264.49

Total Severance Pay

The Total Severance Pay usually includes both basic and adjusted severance. It may also include other benefits, depending on your employer’s policy:

Biweekly Severance Pay

If your severance is paid out over time rather than in a lump sum, the calculator shows your biweekly severance pay. This breaks your total pay into two-week intervals, similar to a regular paycheck.

Number of Weeks

This tells you how many total weeks of pay you are receiving. It reflects the severance period used to calculate the payout, and may also be helpful when considering job searches or applying for unemployment.

Disclaimer

This article is for informational purposes only and does not constitute legal, employment, or financial advice. Severance pay calculations can vary by employer policy, labor laws, and contract terms. Always consult a qualified professional or employment lawyer to understand your specific rights and entitlements.