Labor rights and end of service
End-of-Service Award: Data, Formula, and Resignation Percentage
Explanation of the components used to calculate the end-of-service award, the difference between contract expiration and resignation, and special cases.
The end-of-service award is based on the approved wage, length of service, and the reason for termination. The basic formula is half a month's wage for each year of the first five years and one month's wage for each subsequent year, with prorated calculation for partial years. Provisions regarding resignation or special cases are then applied in accordance with the law.
Key points
- Determine the approved wage for settlement from the contract and records.
- Calculate the length of service accurately in years and fractions of years.
- Distinguish between contract expiration, resignation, and special cases.
- The calculator does not cover all reasons for termination, disputes, or exceptions.
What you need to know
The Ministry of Human Resources explains that the end-of-service award is a right calculated according to the length of service, the final wage, and the statutory formula, and that resignation may change the entitlement percentage depending on the duration. This explanation assumes a relationship governed by the Labor Law and does not cover every special case.
Before calculating, gather the start and end dates, the approved wage, the reason for termination, and any uncalculated periods or interruptions. Do not automatically treat the bank transfer amount as the approved wage; review the contract, wage components, the law, and what the competent authority decides.
After calculating, compare the result with the settlement statement, which also shows the last salary, leave balance, deductions, and other amounts. Do not confuse the end-of-service award with the entire final settlement, as each item has its own basis and record.
Steps
Determine the scope of the law
Ensure that the case is subject to the Labor Law and that no special law changes the path.
Collect the dates and wage
Review the employment contract, the termination decision, the wage statement, and the record.
Calculate the basic award
Apply half a month for the first five years, one month for years beyond that, and prorate partial years.
Apply the reason for termination
Review the resignation provisions, special case, or dispute before approving the percentage.
Compare with the settlement
Separate the award from leave, wages, and deductions, and request a detailed statement.
If something goes wrong
- If the result differs, compare the wage, period, reason, and percentage step by step.
- If there are periods or variable commissions, do not apply a general figure without reviewing the definition of wages.
- If the dispute concerns the reason for termination, keep the decision and correspondence and do not rely on the calculator alone.
Frequently asked questions
Is the award the same as the final settlement?
No. The final settlement may include wages, leave, deductions, and other rights in addition to the award.
Are partial years included?
The official provision states that an employee is entitled for fractions of the year in proportion to the time actually worked.
Does resignation always cancel the award?
No. Percentages and conditions apply according to the length of service and the statutory situation.
Where can I get an estimate?
Use our estimating calculator, and also review the ministry's calculator and official sources.
Official sources
Open the official service — Ministry of Human Resources and Social Development
Last reviewed: