How Much Severance Pay Will I Get?

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May 9, 2009 |  by

Severance pay, or in Australian, a redundancy payment, is often a lifeline when you lose your job. Your employer can only make you redundant when they no longer want the job to be performed by anybody, at all, whatsoever … redundancy is not just an easy way of getting rid of a problem employee.

Check How Much Severance Pay You Get Before Being Laid Off

It may occur because:

  • Your job is replaced by technology
  • Your job, as it used to exist, no longer does because of a restructuring
  • Your employer can’t afford to employ you any more

In most Australian states, and indeed, all over the world, employees that are made redundant are entitled to a payout. After all, you signed a contract saying that you were a ‘permanent’ employee – you need to have some compensation for a ‘breach’ of that contract.

If you have lost your job as a result of your employer being put into liquidation, and you haven’t been notified about receiving your entitlement, check whether you are eligible for assistance under the poetically named GEERS scheme for General Employee Entitlements and Redundancy Scheme.

However, the entitlements vary greatly depending on what state you live in. Industrial relations in Australia is governed state-by-state for most areas (John Howards old IR laws that everybody loved so much were a sort of exception). Calculating your severance pay is fairly simple, though, once you’ve got past that large initial hurdle of determining which state of Australia you work in!!

Wageline is a free government service that helps you determine whether you are being paid appropriately. If you would like to check that all your dosh is coming your way, and not fluttering off into other people’s pockets, give them a call on 1300 655 266.

For NSW Employees:

Severance pay is governed by the Employee Protection Act 1982 No 122. According to the Act, you will receive, at a minimum:

Continuous Service Under 45 years Weekly Pay Over 45 years Weekly pay
Less than one year Nil Nil
1 year but less than 2 years 4 weeks 5 weeks
2 years but less than 3 years 7 weeks 8.75 weeks
3 years but less than 4 years 10 weeks 12.5 weeks
4 years but less than 5 years 12 weeks 15 weeks
5 years but less than 6 years 14 weeks 17.5 weeks
6 years or more 16 weeks 20 weeks

However, you should ask your employer what award you are employed under, and check with www.workplaceauthority.gov.au, as some awards provide for greater than the minimum payments.

For WA employees:

Continuous Service Weeks of Pay
Less than one year Nil
1 year but less than 2 years 4 weeks
2 years but less than 3 years 6 weeks
3 years but less than 4 years 7 weeks
4 years but less than 5 years 8 weeks
5 years but less than 6 years 10 weeks
6 years and less than 7 years 11 weeks
7 years and less than 8 years 13 weeks
8 years and less than 9 years 14 weeks
9 years and less than 10 years 16 weeks
10 years and over 22 weeks

For QLD Employees:

Continuous Service Weeks of Pay
Less than one year Nil
1 year but not more than 2 years 4 weeks
More than 2 years but not more than 3 years 6 weeks
More than 3 years but not more than 4 years 7 weeks
More than 4 years but not more than 5 years 8 weeks
More than 5 years but not more than 6 years 9 weeks
More than 6 years but not more than 7 years 10 weeks
More than 7 years but not more than 8 years 11 weeks
More than 8 years but not more than 9 years 12 weeks
More than 9 years but not more than 10 years 13 weeks
More than 10 years but not more than 11 years 14 weeks
More than 11 years but not more than 12 years 15 weeks
More than 12 years 16 weeks

For SA Employees:

Redundancy in governed by the Fair Work Act 1994, but severance pay appears to be determined by individual awards.

For Victorian Employees:

EMPLOYERS OF LESS THAN 15 EMPLOYEES ENTITLEMENT TO SEVERANCE PAY

Continuous Service Weeks of Pay
Less than one year Nil
1 year and up to the completion of 2 years 4 weeks
2 years and up to the completion of 3 years 6 weeks
3 years and up to the completion of 4 years 7 weeks
4 years and over 8 weeks

EMPLOYERS OF MORE THAN 15 EMPLOYEES ENTITLEMENT TO SEVERANCE PAY

Continuous Service Weeks of Pay
Less than one year Nil
1 year but less than 2 years 4 weeks
2 years but less than 3 years 6 weeks
3 years but less than 4 years 7 weeks
4 years but less than 5 years 8 weeks
5 years but less than 6 years 10 weeks
6 years and less than 7 years 11 weeks
7 years and less than 8 years 13 weeks
8 years and less than 9 years 14 weeks
9 years and less than 10 years 16 weeks
10 years and over 22 weeks

For Tasmanian Employees:

There are currently no standard laws governing severance pay in Tasmania, however individual awards have their own entitlements. Check on these with Workplace Standards Tasmania.

Photo source: liber

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