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Question: How to compute severance payment and long service payment?

The following formula applies to the calculation of both severance payment and long service payment:

Monthly-paid employee

(last month wages^* X 2/3)^#

reckonable years of service

Daily-rated/piece-rated employee

(any 18 days' wages^*chosen by the employee out of his last 30 normal working days)^#

reckonable years of service

Click here for more information in Labour Department.

^*	An employee may also elect to use his average wages in the last 12 months for the calculation.
^#	The sum should not exceed 2/3 of $22,500 (i.e. $15,000).