How to calculate the settlement that corresponds to you if you are fired?

When an employment relationship ends, the worker has the right to collect a severance payment regardless of the reason for termination.

NewsEditor
NewsEditor
04 August 2022 Thursday 22:55
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How to calculate the settlement that corresponds to you if you are fired?

When an employment relationship ends, the worker has the right to collect a severance payment regardless of the reason for termination. Thus, whether due to dismissal, termination of a temporary contract or voluntary termination, the company must deliver the severance pay to the employee at the time the relationship ends.

In the settlement, the company must include the remuneration that corresponds to the employee and that has not yet been received to date. In addition, in some cases, you must also include compensation.

The amount of the settlement depends on the salary structure and the collective agreement, however, as a general rule, it must include these 6 remunerations:

The settlement is calculated by adding the 6 previous elements. Let’s see how to find the figures corresponding to each of these remunerations:

Days of salary of the last month

The first step to calculate the settlement is to take into account the last days worked and quoted. To do this, you must know the daily wage and multiply it by the number of days worked after the last payroll was received.

To know how much is charged per day, if the salary is fixed, the monthly payment received the month prior to the end of the contract is taken as a reference and divided by 30.

Example

A worker who earns €2,000 a month quits his job on October 15.

His daily salary is: €2,000/30 days= €66.66/day.

Days of salary in the last month: 15 days worked x daily salary €66.66= €1,000.

Holiday not enjoyed

As we have seen, another fundamental part for calculating the settlement is that of the vacations generated but not taken. In order to calculate this part, it is necessary to know how many vacation days per year correspond to the worker according to the contract or agreement. The most common is to have 30 days.

Example

The employment relationship ended on October 15, which means that the employee has worked 9 months and 15 days this year, equivalent to 283 days worked.

If for a whole year (360 days) he is entitled to 30 days of vacation, following a rule of three, we will see that for 283 days worked he is entitled to 23.5 days of vacation.

In this case, the company will have to pay 23.5 days of vacation to the settlement if the employee has not yet taken vacation. Now, suppose that the worker has taken 15 days of vacation in August: the calculation would be 23.5 - 15 = 8.5 days of vacation pending payment. That multiplied by the daily salary is €572.2.

extraordinary payments

As for the extra payments, in order for them to be included in the settlement, they do not have to be prorated. That is, they are not paid little by little in 12 monthly installments a year. In the rest of the cases, the extraordinary payments are generated, in general, in summer and Christmas. These are periods of six months, unless the collective agreement stipulates another type of accrual.

This part of the calculation is like that of vacations, but taking as a reference the time elapsed since the last extra pay was received.

Example

The contract employee has to receive €2,000 extra pay for Christmas. €2,000/182.5 days (6 months) = €10.9 per day. From July 1, when he received the first extra payment, until October 15, when the contract expires, 107 days have passed.

Therefore, the proportional part of extra payments to be collected: 107 x €10.9= €1,166.3.

In short, to know the final figure of the settlement to be received, add the result of the money corresponding to the last days worked and not received, the vacations not taken and the proportional part of the extraordinary payments.

Continuing with the same example

Settlement = €1,000 (salary last days) €572.2 (holidays not taken) €1,166.3 (proportional part paid extra) = €2,738.5

Now, it must be borne in mind that this final figure of the settlement is 'raw' money from which it is necessary to subtract what the worker assumes from Social Security contributions, as well as income tax withholdings.

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