How is the termination benefit payment calculated and when is the benefit payable to the employee?

Rate of severance benefits must be in accordance with the service contract, but could not be less than the minimum rate set under the Employment (Termination and Lay-Off Benefits) Regulations 1980, Employment Act 1955 which are: - 

1. 10 days' salary for each year of service if the employee has served less than 2 years;
2. 15 days' salary for each year of service if the employee has served for 2 years but less than 5 years; or
3. 20 days salary for each year of service if the employee has served 5 years or more 

and calculated prorated over an incomplete period of a year, following the nearest complete month. The formula set under the Employment (Termination and Lay-Off Benefits) Regulations 1980, is as follows: 

12 Months/365 days’ salary X Length of Service (Number of Years of Service) X Eligibility (10/15/20 Days per Year) 

Employees are entitled to receive written termination benefits amount and its calculation method. Termination benefits must be paid no later than 7 days from termination date. A termination benefit calculation calculator is available at the Calculator menu.