Severance Pay Calculator
Severance pay calculator — estimate termination or retrenchment benefits from your monthly salary, years of service and a days-per-year basis, including a Malaysia Employment Act tiered preset. A general guide, not legal advice. In your choice of currency. Runs in your browser.
Severance Pay Calculator
How to Use the Severance Pay Calculator
Enter salary and tenure
Type your monthly salary and your years of service (decimals are fine for part-years).
Choose a basis
Pick the Malaysia Employment Act tiers, a fixed days-per-year rate, or enter a custom figure from your contract.
Read the estimate
See the severance amount, the days’ wages and roughly how many months’ pay that represents.
Verify it
Treat the figure as a guide only and confirm your actual entitlement with your contract or the relevant authority.
Understanding Severance Pay
Losing a job to redundancy or retrenchment is stressful enough without the uncertainty of not knowing what you are owed, and severance rules are notoriously opaque. This calculator gives you a clear, structured estimate based on the most common way such benefits are computed: a daily wage multiplied by a set number of days for each year of service, multiplied by your length of service. The daily wage is derived from your monthly salary using the widely used convention of dividing by twenty-six working days, and the days-per-year figure is the lever that captures how generous a particular scheme is. Enter your salary and tenure, choose a basis, and the tool shows the amount, the total days’ wages it represents, and roughly how many months of pay that comes to.
Because there is no single global standard, the basis is adjustable rather than fixed. The built-in Malaysia preset reflects that country’s Employment (Termination and Lay-Off Benefits) Regulations, which set minimum benefits on a sliding scale rewarding longer service: ten days’ wages per year of service for under two years, fifteen days for two to under five years, and twenty days for five years or more. The calculator applies the correct tier automatically from the years you enter. If your scheme works differently, you can pick a flat rate of ten, fifteen or twenty days, or enter a custom figure straight from your contract or collective agreement — which is important, because contracts and company policies often improve on the statutory minimum.
The single most important thing to understand about this tool is its limits. Severance, redundancy and retrenchment law varies enormously from country to country; some jurisdictions mandate generous payments, others very little, and some none at all. Eligibility frequently depends on the reason for leaving — redundancy is treated quite differently from resignation or dismissal for cause — and pay in lieu of notice is usually a separate entitlement on top of severance, not included here. For all those reasons this is a general educational estimate, not legal or financial advice, and it cannot tell you whether you are actually entitled to a payment. Use it to get a sense of the scale of what might be due, then confirm the details with your employment contract, the relevant labour authority, or a qualified adviser. Everything is computed in your browser, so none of the figures you enter ever leave your device.
Severance formulas are only a starting point — your contract, your country’s law and the reason you’re leaving all decide what you’re actually owed.
10 Facts About Severance Pay
Severance is often based on tenure × a daily-wage rate.
In Malaysia, longer service earns more days per year.
A common daily-wage basis is monthly salary ÷ 26.
Rules differ hugely by country and contract.
Some countries have no statutory severance at all.
Eligibility can depend on the reason for leaving.
Redundancy and dismissal are treated differently.
Notice pay is usually separate from severance.
Contracts may offer more than the legal minimum.
This calculator runs in your browser — nothing is uploaded.
Frequently Asked Questions
- The tool multiplies a daily wage by a number of days per year of service and by your years of service. The daily wage is taken as your monthly salary divided by 26, a common convention. So with a basis of 20 days per year and six years of service, you get 120 days’ wages.
- Malaysia’s Employment (Termination and Lay-Off Benefits) Regulations set minimum termination benefits on a sliding scale by length of service: 10 days’ wages per year for under two years, 15 days for two to under five years, and 20 days for five years or more. The preset applies the right tier automatically based on the years you enter.
- Dividing by 26 approximates the number of working days in a month and is a widely used way to derive a daily wage from a monthly salary for benefit calculations. Some schemes use a different divisor or an "ordinary rate of pay"; if yours does, treat the result as an approximation and adjust accordingly.
- No — and this is the most important caveat. Statutory severance, redundancy and retrenchment benefits vary enormously between countries, and some have none at all. The days-per-year basis lets you model different schemes, and the Malaysia preset is provided as one concrete example, but you must check the rules that actually apply to you.
- Very much. Many schemes pay severance for redundancy or lay-off but not for resignation or dismissal for misconduct, and the amount can differ by reason. This tool calculates a benefit amount from a formula; it does not determine whether you are legally entitled to it, which depends on the circumstances of the termination.
- No. Pay in lieu of notice is normally a separate entitlement from severance or termination benefits, governed by your notice period. Calculate it separately and add it if it applies. This tool covers only the tenure-based severance component.
- Yes. Statutory figures are minimums; an employment contract, company policy or collective agreement can be more generous, offering a higher number of days per year or additional payments. If your contract specifies a better formula, enter that days-per-year figure using the custom option.
- Enter your years of service as a decimal — for example 3.5 for three and a half years — and the calculation pro-rates accordingly. Whether and how partial years count toward statutory benefits depends on the specific scheme, so verify the treatment of part-years in your jurisdiction.
- No. It is an educational estimate to help you understand the scale of a potential entitlement. Actual severance depends on legislation, your contract, the reason for termination and other factors, and disputes are common. For anything that matters, consult your contract, the relevant labour authority, or a qualified adviser.
- Completely free, with no account or usage limit. It runs entirely in your browser, collects no data, and works offline once the page has loaded.
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