Severance pay estimator
Negotiating a severance package? See the statutory minimum you're entitled to — and what's fair to push for. This is an educational estimate, not legal advice.
Employer email template
Subject: Request for final pay review
I am writing to ask you to review my final pay. Based on the information available to me, I believe the amount or deadline may not match the applicable rule. Please confirm the calculation, the pay period covered, any deductions, and the expected payment date.
Wage claim checklist
- OK Final payslip or pay statement
- OK Employment contract or handbook policy
- OK Dates worked and termination/resignation date
- OK Written request sent to employer
- OK Official state or country claim link
How severance pay is estimated
Severance pay is the money some employers provide when they end your employment, usually in a layoff or restructuring. Unlike redundancy pay in the UK or termination pay in Canada, severance in the United States is rarely required by law — it is driven by your contract, an employee handbook, or a negotiated exit agreement.
This estimator multiplies your years of service by a weeks-per-year figure and your gross weekly pay. The default of one week per year reflects a common policy, but you can adjust it to match an offer you have received. For Canada, the calculator applies the federal statutory minimum (Canada Labour Code Part III) where it exceeds the policy figure — but this federal rule only covers federally-regulated employers such as banks, telecoms, airlines, and interprovincial transport. Most Canadian employees are covered by their province's employment standards instead, which set different minimums. Check your province's rules before relying on this figure as your legal entitlement.
Severance is also separate from any notice you are owed. In a large layoff, US employers may have to give advance notice under the federal WARN Act, and a severance offer is usually tied to a written agreement that releases the employer from future claims. Treat the number this tool produces as your baseline, then weigh it against what you may be giving up by signing.
Because severance is so often negotiable, it helps to walk into the conversation with a clear number. Download the PDF summary and use it as the starting point for discussions with your employer.
Frequently asked questions
Is severance pay required by law?+−
In most US states and in the UK private sector, severance is not legally required — it is set by your contract or employer policy. Canada is an exception, where employment-standards law sets a statutory minimum termination and severance pay.
How much severance is typical?+−
A common benchmark is one to two weeks of pay for each year of service, though senior roles and negotiated exits can be higher. This calculator lets you set the weeks-per-year figure to match your situation.
Is severance pay taxable?+−
Yes. Severance is generally treated as taxable income and is subject to income tax and, in many cases, payroll taxes. The figure shown here is a gross, pre-tax estimate.
Can I negotiate my severance?+−
Often, yes — especially where severance is policy-based rather than statutory. Your length of service, the reason for termination and any release of claims are common negotiating points.
When is severance usually paid?+−
Most often as a lump sum on or shortly after your last day, though some agreements pay it in instalments over a few months. The timing is set by the severance agreement, so check the document for the exact schedule.
Does accepting severance mean I waive my right to sue?+−
Frequently, yes. Severance agreements commonly include a release of claims, meaning that by signing you give up the right to bring certain legal claims against your employer. Because this is a legal waiver, it is worth reviewing carefully before signing.
Legal basis and primary sources
All statutory figures are sourced directly from official government legislation and guidance. See our methodology →