Separation Pay Calculator 2026
For redundancy, separation pay is monthly pay × 1 for every year of service, and never less than monthly pay × 1. With a ₱ 20,000 monthly pay and 5 years of service, it is ₱ 100,000.00. Choose the reason for separation below to apply the right rate.
Tables: 2026
Your figures stay on this device. They are not sent to our servers.
Result
Separation pay
₱ 100,000.00
Tables: 2026
| Pay per year of service (monthly pay × 1) | ₱ 20,000.00 |
|---|---|
| Computed for credited years of service: 5 | ₱ 100,000.00 |
| Minimum (monthly pay × 1) | ₱ 20,000.00 |
| Separation pay | ₱ 100,000.00 |
Notes
- Use your latest salary rate; regular allowances may be included in it.
How this was computed
Separation pay = monthly pay × 1 × credited years of service (5), but never less than monthly pay × 1. A fraction of at least 6 months counts as one full year.
Estimate only. Not legal, tax, or financial advice.
Worked example
Redundancy, monthly pay ₱ 20,000, 5 years of service: ₱ 20,000.00 per year × 5 years = ₱ 100,000.00. This is above the minimum of ₱ 20,000.00, so the separation pay is ₱ 100,000.00.
How it works
The rate depends on the reason. Redundancy or labor-saving devices: one month of pay per year of service. Closure not due to serious losses, retrenchment to prevent losses, or illness: half a month of pay per year of service. A fraction of at least 6 months counts as a full year, and the result is never less than monthly pay × 1.
Separation pay = monthly pay × 1 × credited years of service (5), but never less than monthly pay × 1. A fraction of at least 6 months counts as one full year.
Frequently asked questions
How much is separation pay per year of service?
It depends on the reason for separation. For redundancy or labor-saving devices it is monthly pay × 1 per year of service; for closure not due to serious losses, retrenchment or illness it is half a month of pay per year. The minimum is always one month of pay.
Is a fraction of a year counted for separation pay?
Yes. A fraction of at least 6 months counts as one whole year of service.
Do I get separation pay if I resign?
Not by law. Separation pay is due for authorized causes such as closure, redundancy, retrenchment or illness, unless your contract or company policy grants it on resignation.
Is separation pay taxable?
Separation pay received because of causes beyond the employee's control, such as redundancy or closure, is generally exempt from income tax. Check with the BIR or your employer for your case.