Termination of employment is an unpleasant but commonplace thing in the labor market. In order for the “divorce” of the employer and employee to be civilized and arranged by both parties, the requirements of the labor law should be observed. In particular, the employer must pay severance pay to the employee in the event of his or her dismissal due to certain circumstances. The State Employment Service explained all the nuances of this sensitive issue.
The severance pay is a guarantee that allows a temporary replacement of earnings for an employee and allows to focus on finding a new job.
The amount of severance pay differs depending on the reason for the dismissal.
At least average monthly earnings:
- in case of termination of the employment contract when the employee refuses to transfer to work in another locality together with the enterprise, institution, organization, as well as refusal to continue work in connection with the change of essential working conditions (paragraph 6 of Article 36 of the Code of Laws on work of Ukraine, hereinafter – LCU);
- in case of changes in the organization of production and labor, reduction of the number of staff (item 1 of Article 40 of the LCU);
- in case of discrepancy of the employee in the position or work performed (item 2 of Article 40 of the LCU);
- upon resumption of an employee who has previously performed this work (item 6 of Article 40 of the LCU).
In the amount of two minimum wages:
- in the case of conscription or entry into military service, referral to alternative (non-military) service (item 3 of Article 36 of the LCU).
At least three months average earnings:
- in case of termination of the employment contract as a result of violation of the labor legislation, collective or employment contract by the owner or authorized body (Articles 38 and 39 of the LCU).
At least six months average earnings:
- in case of termination of authority of officials (item 5 of Part 1 of Article 41 of the LCU).
At least four months average earnings:
- upon dismissal on the basis of changes in the organization of production and labor, reduction in number of staff (item 1 of Article 40 of the LCU) of an employee who is a person affected by the Chornobyl catastrophe, classified in category I (Article 20 of the Law of Ukraine “On status and social protection for the victims of the Chornobyl disaster”). In this case, the amount of three times the average monthly salary is offset from the budget by the bodies of social protection, centers for accrual and payment of social assistance, labor and social protection departments at the place of registration of citizens.
A larger amount of severance pay may be determined by a collective and employment contract. According to Art. 116 of the Labor Code of Ukraine, upon dismissal of an employee, payment of all amounts due to him from the enterprise, institution, organization shall be made on the day of dismissal. If the employee do not work on the day of dismissal, the said amounts must be paid not later than the next day after the dismissed employee submits a payment request.
