Severance Pay Calculator

How severance is estimated

Most severance formulas tie pay to tenure. You pick a number of weeks of pay for each year of service, multiply by the years worked, and apply a cap. This tool turns the annual salary into a weekly figure, applies your policy, and shows the result in dollars, weeks, and roughly months. Add accrued time off and a benefits subsidy and it gives you a fuller package figure.

What is typical

A common rule of thumb is one to two weeks of pay per year of service. Entry-level and individual contributor roles often sit at the lower end, managers and directors higher, and executives higher still, sometimes a flat number of months set by contract. Technology and finance tend to run more generous, retail and hospitality less. A cap around 26 weeks is common.

What else is in a package

Beyond the cash, severance packages often include a payout of accrued unused time off, a subsidy toward continued health coverage for a few months, and outplacement support to help the person find their next role. Senior or long-tenured employees sometimes see extended benefits or other enhancements. The mix depends on company policy and the role.

A note on the rules

In the United States there is generally no federal requirement to pay severance; it is a matter of company policy or contract. Separate from severance, the federal WARN Act can require advance notice for larger layoffs, and some states have their own notice or severance rules. Separation agreements usually involve a release and have federal review periods. Because what applies depends on your specifics, treat this as a planning estimate and confirm the rules with an employment attorney.

How is severance pay calculated?

Usually as a number of weeks of pay per year of service. Take the weekly salary, multiply by weeks-per-year times years worked, and apply any cap. This tool does that and adds optional payout and benefits figures.

Is severance pay required by law?

In most cases there is no federal requirement; it is set by company policy or a contract. Separate notice rules such as the WARN Act can apply to larger layoffs, and some states have their own rules. Confirm with an employment attorney.

How many weeks of severance per year is typical?

One to two weeks per year of service is the common baseline. It runs higher for managers and executives, and varies by industry. A cap near 26 weeks is common.

What is usually included besides pay?

Often a payout of accrued unused time off, a subsidy toward health coverage for several months, and outplacement support. The exact mix depends on policy and role.

Is this legal or HR advice?

No. It is a planning estimate built on common norms. Severance, notice, and final-pay rules depend on your situation, so review any reduction with qualified counsel.