Conditions for payment of compensation for early dismissal
When liquidating an organization or reducing staff, the employer is obliged to notify its employees 2 months in advance (Part 2 of Article 180 of the Labor Code of the Russian Federation). This is done in writing by sending a notice to the employee.
An employee may resign earlier than the period specified in the notice, receiving additional compensation for this. To do this, he needs to give his consent to early dismissal: write a statement or indicate on the notice of dismissal that he agrees to terminate the contract ahead of schedule.
For information on how to prepare an application for early dismissal, see this article.
How to resign correctly in order to receive all compensation?
Upon dismissal due to staff reduction, you should:
- Make sure you are not on the list of people who have a priority right to remain employed.
- Demand the provision of vacancies if they are available.
- Dismissal must be carried out under paragraph 1 or 2 of Art. 81 Labor Code of the Russian Federation. You should not make mistakes when writing an application or succumb to pressure from management and agree to dismissal by agreement of the parties. In this case, the employee loses the right to all benefits and payments provided by law.
- It is necessary to register with the Employment Center before the expiration of 14 days after dismissal in order to receive cash payments within two months if it is not possible to find a job.
Severance pay in case of staff reduction is support for the period of searching for a new job. The procedure for calculation and payment is regulated by the legislative acts of the Russian Federation. The employer's accounting department handles the registration and calculation of severance pay and subsequent payments. For violation of payment deadlines or incorrect accrual, the organization may be held liable.
An example of calculating additional compensation for early dismissal
Let's look at how compensation is calculated for early dismissal.
Example
10.12.2020 Stepanov V.S. notified of the upcoming termination of the employment contract due to liquidation on 12/15/2020. He retired early on October 16, 2020. The number of working days before dismissal by notice is 42 (from 10/17 to 12/15). The number of days actually worked over the last 12 months (September 2021 – October 2019) is 248. The average monthly salary is 45,000 rubles. Salary for the billing period (last 12 months) - 540,000 rubles.
Let us determine the amount of compensation that Stepanov will receive upon early dismissal.
We calculate the average daily earnings: 540,000: 248 = 2,177.42 rubles.
We calculate the amount of compensation for early dismissal: 2,177.42 x 42 = 91,451.64 rubles.
Thus, Stepanov will receive 91,451.64 rubles for early termination of the employment contract.
Dismissal procedure
Let us consider the stages, and also describe their nuances and actions necessary for the legality of the procedure.
The decision to start downsizing. The employer has every right to accept it at his own discretion and choose any suitable time. Moreover, he is not obliged to explain the reasons or report to anyone.
Definition of beneficiaries. There are citizens who, when laid off, must be retained in their positions in the first place.
Reduction order . Within 3 days after publication, it is handed over to those dismissed for review, each individually. This is not yet an order of dismissal in form T-8 or T-8a, but only about a planned event.
Notification . Under standard circumstances, the employer is required to notify staff of layoffs at least 2 months in advance. until the last day of work.
If there is agreement with the person being laid off, then he has the right not to comply with this rule, but then he is obliged to compensate this period or its balance with money, based on the average monthly earnings. This is the main nuance of payments for early dismissal during layoffs. Each of the parties has the right to propose not to comply with the notice period, and the employee must have written consent to this.
Order of dismissal under clause 2 of Art. 81 TK . It can be published not only on the deadline for work, but also several days before it. Awarded against signature within 3 days. from the date of signing for each person leaving. This also applies to the T-8a form (mass layoff) - it is given to each person being laid off.
This is important to know: Order of dismissal for absenteeism: sample 2021
Finishing measures. On the last working day, a personal card (T-2) is filled out, a mark is placed in the work book, which is handed to the employee. On the same day they pay him in full.
Deadline for payment of compensation for early dismissal
Additional compensation for early termination of an employment contract must be paid on the day of dismissal. All other “severance” payments are paid on the same day:
- salary for time worked before dismissal;
- compensation for unused vacation;
- severance pay.
Earnings during employment are not paid on the day of dismissal, since it is impossible to calculate the period for which it will be accrued.
Additional compensation, like all other payments, is transferred to the employee’s bank card (if the salary was previously transferred to it) or issued from the cash register.
What to do if payments are not paid?
If the employer did not transfer the funds on time, then he is obliged to compensate them and a penalty of no less than 1/150 of the key rate (Article 236 of the Labor Code of the Russian Federation) for each day of delay.
If an employee’s rights are violated, they contact the labor inspectorate or the labor dispute commission. But these bodies do not have the right to recover material and moral damage from the employer; they can only issue fines and issue orders that the employer can ignore.
Applying to the court at the employer’s location with a claim is the most effective way to solve the problem. It is this body that has the right to collect money. It should be remembered that late interest must also be included in the claim. They can be increased at your own discretion, if there are reasonable grounds for this (money was required for treatment, loan repayment, etc.).
Let's sum it up
- Compensation for early dismissal is calculated based on the employee’s average earnings.
- It is paid for the period from the day following dismissal until the day of termination of the employment contract specified in the notice.
- When calculating compensation, one should be guided by Art. 139 of the Labor Code of the Russian Federation and the Regulations on the specifics of the procedure for calculating average wages.
- Additional compensation is paid to the employee on the day of dismissal.
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How to calculate severance pay
As mentioned earlier, severance pay is calculated based on the average monthly earnings and is paid in a lump sum for one calendar month.
That is, if the date of your dismissal is September 1, then you are required to pay benefits for the period from September 2 to October 1.
If you registered with the employment center on time and you have not received any suitable job offers for a month, your benefit payment period may be extended.
The 2nd month is counted from October 2 to November 1. If you are entitled to a 3rd benefit, you can also apply for it to your employer only after the 3rd month has passed.
The 3rd benefit is paid when a dismissed employee applies to the employment center no later than 14 calendar days after the official layoff. This period also includes weekends and non-working days.
To calculate average monthly earnings, the period when the employee did not perform his duties but received wages (vacation, sick leave) is not included in the credit.
When calculating the average monthly payment, bonuses and rewards are also taken into account when calculating severance pay for an employee.
When should the money be disbursed?
As a general rule, all payments to a dismissed employee must be made no later than on the last day of his work (Article 140 of the Labor Code of the Russian Federation).
If, on the day the dismissal occurred, the employee did not carry out his work activity, all payments must be made no later than the next day after the dismissed person requested a full settlement with him. If there is a dispute between the employee and the employer about exactly what funds should be paid, the employer must pay the minimum amount about which there is no dispute within the deadlines indicated above. The rest is paid if the dispute is won by the employee.
How is severance pay calculated in the event of a layoff?
The redundancy benefit is calculated using the formula:
Severance pay = Number of working days (hours) in 1 month. after dismissal (from the day following the day of dismissal) × Average days. (hourly) earnings.
A reduction benefit in the amount of average monthly earnings is considered the minimum limit. If during the calculation period the employee has fully worked the standard time, then his average monthly earnings should not be less than 1 minimum wage. This minimum is set for wages. If an employee’s working hours are recorded by day, the average daily earnings are determined as follows:
Average day earnings = the employee's earnings for the days he worked in the calculation period: the number of days actually worked during the calculation period.
The calculation includes remuneration and bonuses in accordance with clause 15 of the Regulations (Resolution of the Government of Russia dated December 24, 2007 No. 922)
What payments are required?
Among the payments due to an employee if he is fired by his employer, two main groups can be distinguished:
- Mandatory, regardless of the grounds on which the employment contract was terminated.
- Special, related to specific circumstances (for example, payments for staff reduction).
First, let's look at those that are absolutely always paid.
For actual time worked
The employer's obligation to pay wages is one of the basic principles on which all employment relationships are based. Therefore, even if an employee is dismissed for disciplinary violations and other guilty actions, at the time of dismissal he must receive everything he has earned.
The specific amount of the salary to be paid is determined based on the remuneration system adopted at the enterprise and established by the employment contract. The amount of payments may depend on:
- With time-based payment - based on the time worked by the employee during the last month (in Russia, salary calculation is mainly used based on monthly payments).
- In case of piecework - based on the amount of work performed since the previous payment of money earned by the employee.
The specific procedure and amount of payments must be determined based on the specific terms of the employment contract concluded with the dismissed employee.
For vacation
Art. 114 of the Labor Code of the Russian Federation provides that each employee must be provided with paid leave annually. Its size is usually 28 days, unless the terms of the employment contract or the norms of the Labor Code of the Russian Federation provide for an increased duration. Unused vacation is calculated as follows:
- The period of work in the organization is calculated. It does not include leave to care for a child, absence from work without good reason, or leave taken at your own expense for more than 14 days.
- If more than six months have passed since employment with the company, then compensation is calculated for 28 days (unless the law establishes a longer duration of annual leave).
- If less than 6 months have passed, or the employee has already used vacation, then the number of days for which compensation is paid is calculated in proportion to the time worked).
- Payments are based on the employee's average daily earnings.
To calculate the proportion, use the formula:
D = 28 / 12 * M where:
- 28 – the number of vacation days due per year.
- 12 is the number of months in a year.
- M – the number of months worked for the employer since the last vacation.
An example of a calculation is the following option: employee Ivanov worked in the organization for 3 months. He will be entitled to compensation for the following duration of leave:
28 / 12 * 3 = 2,(3) * 3 = 7 days.
The average daily earnings are calculated using the formula:
DR / 12 / 29.3 where:
- DR - the employee’s income, all regular payments received by him in connection with the employment contract for the billing period (calendar year). One-time compensation or financial assistance paid by the employer is not included in the calculation.
- 12 is the number of months in a year.
- 29.3 – average number of days in a calendar month.
Calculation example: employee Ivanov received 350 thousand rubles for the year. What is his average daily earnings for this period?
350,000 / 12 / 29.3 = 995.45 rubles (result rounded to the nearest whole number of kopecks).
