Retiring from Job – Indemnity calculation
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As always I seek your advise regarding the subject matter and looking forward your kind reply in order to take up with my office as there are some calculations issue.
The details are like this; company has told me to retire now from service and the details are as below:
Joining date: July 1st 2009
Retirement date: Nov 30, 2018
Salary: KD 820 per month
Leave balance: 29 and 1/2 days
What will be my indemnity amount and what will be my leave balance amount. Your reply will help me to take up the matter with my HR department. Thanks for your understanding and support.
Name withheld
Answer:
Your indemnity will be calculated as follows:
Service: 9.3 years
Salary: KD 820
You are entitled to 15 days salary for each of the first five years service = 75 days; but this has to be first divided by 26 = 2.88 months salary.
For the next 4 years and 4 months, you will get one month salary for each year = 4.3 months salary.
Total 2.88 + 4.3 = 7.18 months salary. = 7.18 x KD 820 = KD 5,887.600.
You also have a leave balance of 29 days which must be paid as follows.
Salary divided by 26 x 29 = KD 820/26 x 29 = KD 914.615.
This amount should be added to the above total = KD 914.615 + KD 5,887.600 = KD 6,802.215.
As you have been asked to retire you will receive the whole amount of KD 6,802.215 even though you have not put in 10 years of service.
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