Sunday , September 23 2018

# Company will be terminating staff to downsize in Dec 2016 – Calculation of Indemnity

Whenever I have a doubt regarding residence etc. I have contacted you and I am thankful to your kind response.

This time the issue is as below. Joined my current company on July 1, 2009. Most probably the last day of the service will be Dec 31, 2016.

It is not a resignation but the company will be terminating me because they are downsizing the organization. Total salary per month KD 790.

In this scenario what will be the termination benefits plus the amount and the method of calculation.

Name withheld

Answer: In this case, as your services are being terminated, you will get your full indemnity plus you have to be paid for any balance of annual leave.

The indemnity will be calculated as follows:

Service: 9.5 years

Salary: KD 790

For the first 5 years you get 15 days salary for each year = 75 days … but these days have to be divided by 26 (working days in a month) = 2.88 months salary

For the next 4.5 years you get one month’s salary for each year = 4.5 months salary

Total indemnity = 7.38 months salary = 7.38 x KD 790 = KD 5,830.200

You are entitled to the full above amount.