In the event of dismissal or leaving the place of work for any other reason, each employee is required to receive the material means due to him. The term of employment in a particular enterprise does not matter at the same time, as well as the reason for dismissal. When calculating the corresponding amounts, employees often have doubts and questions, but was the calculation of the average monthly earnings upon dismissal carried out correctly? You can verify this yourself using special accounting formulas immediately after receiving notice of deduction from the workplace.
Definition of a concept
Average income is an indicator of the material income of an employee for a specific period of time.
Most often, various calculations use earnings data for one working day. To calculate them, it is necessary to take into account only those payments that relate directly to the payment of quality work and working time. For this, a special formula for calculating the average earnings at dismissal is used, which will be given below with calculations for an example. Average earnings are determined by the accounting department according to the payment for the last 12 months of the employee’s service. If he worked at the enterprise for a shorter period, then the calculations will be based on the income received for the period actually worked, but always a multiple of a whole month.
What is used for
Average earnings are required when calculating travel, vacation, sick leave and payments for the employee training period. Also, the average income indicator is required if the employee was transferred to another position due to health reasons. In such cases, the average earnings are paid until a permanent disability is established.
The indicator is also taken into account for calculating the payment of the period of incapacity for various reasons: the calculation of the average earnings of the maternity wage, when leaving with unused leave, and so on. Thus, this amount is the average indicator of the employee’s income for a specific period, so that on its basis it would be possible to calculate the payment to the employee for the time period that was not worked out in fact.
Calculation Data
According to government decree No. 922, all calculations of average earnings are carried out. The list of incomes that affect the calculation of the average indicator is also indicated there.
So, to calculate the average earnings at the dismissal, it is necessary to take into account all possible payments stipulated by the labor contract at a particular enterprise, except those calculated on the basis of the same average earnings.
That is, you need to consider:
- salary or tariff rate of a particular position;
- all kinds of allowances;
- Prizes
- fees and any cash rewards;
- surcharges.
At the same time, the calculations do not include payments for already used holidays, sick leave and other earnings based on average income. When calculating the size of premiums, it should be borne in mind that if it is paid once a quarter, then only one corresponding part is accounted for one month. Monthly cash incentives are included in the calculations in the amount of not more than one indicator. If the worked month necessary for settlements was incomplete, then the bonus is calculated on the basis of the proportion of the laid bonus proportional to the worked time.
Easiest option
In order not to delve into the procedure for calculating the average earnings at the dismissal and at the same time to independently know the amount of the payment due for a particular case, you can use a special online calculator. The application displays the finished result in a matter of seconds, you just need to load certain data into it. To do this, you need to specify the period for calculation, the number of days that are not taken into account for the calculation (vacation or sick leave), salary and the size of all other payments received for the desired period. Further, the program itself will perform all the necessary calculations with maximum accuracy, and the employee will receive a finished result.
Calculation of average earnings at dismissal
To perform the calculations yourself, you will first need to add up all the amounts received for the last working year. To do this, it is better to be guided by the salary cards issued by the company or to ask the accounting department for a printout of the income accrued to a particular employee for the last 12 paid periods.
It is better not to count on your own memory, since even approximately the same values can noticeably distort the final result of the calculations. After that, the entire amount received for the year should be divided by 12, which will provide an accurate average earnings for the month.
Average daily earnings
Most often, this indicator is taken into account for calculating all kinds of payments. The law establishes that the average indicator of working days in a month is 29.3 days off. Multiplying the worked months by this number, you get the number of exits for the entire calculation period. The most accurate amount of daily earnings is given by calculation taking into account the total time worked, and not just one month, since this indicator is also averaged.
To determine the amount of payment for one work output on average, you will need to multiply the number of worked months by a factor of 29.3. Further, the previously obtained result of total income for the entire period is divided by the number of all worked settlement days, and the average daily earnings are obtained. It is important that it is not below the statutory minimum.
Nuances
If an employee has worked in the company for less than a year, then to calculate the average monthly income, you will need to take the number of actually worked full billing periods. The total amount received over the entire period will need to be divided by the number of months worked, which will give the final result.
It is very important to understand that the calculation of average earnings at termination of employment is made only on the basis of a full working month. If there is half a month in the total worked period, then it will not be taken into account at all in the calculations.
If during the calculation period the employee was sick, was on vacation or did not visit the workplace for other reasons, then these days will not be taken into account in the calculations.
Their number must be subtracted from the total number of working days and only then carry out further calculations.
The calculation of the average earnings at the dismissal after the decree cannot be carried out on the basis of income for the last year, since there simply weren’t any. In this case, to determine the average indicator, the tariff rate for a particular position previously occupied is taken, and on the basis of it, the severance pay is calculated.
Unused vacation
The calculation of the average earnings at dismissal to compensate for unused vacation is also based on the average daily income, since representatives of far from every profession can afford a vacation of more than a month. The standard period is considered to be 28 days of rest per year, and unused, usually even less. To calculate the required amount, you just need to know your average earnings.
Next, you should determine the number of days left at the time of dismissal. It is very important to understand that all calculations are carried out not from the beginning of the calendar year, but from the moment the employee is hired. That is, if an employee was officially employed on August 18, 2017, then he receives the right to his first full leave only on August 17, 2018. Moreover, if during the worked period he took free leave, skipped working days or was on maternity leave, the length of service is increased by this period, that is, leave will be laid later. Hospital and parts of paid leave do not affect the change in seniority.
Also, the worked period of less than half a month is not included in the length of service.
Determining the number of days
Only on the basis of the exact number of unused days of rest, vacation compensation upon dismissal is calculated. Calculation of average earnings in the future helps to find out a specific amount.
So, in order to determine how many days of rest are set for a specific working period, and not a full year after employment, it is necessary to multiply the number of full months by a factor of 2.33. Incomplete billing periods (not multiple of the whole month) are not taken into account at all. The result is always rounded towards the employee.
For example, if an employee has worked at the enterprise for 10 months, then he is supposed to compensate for 24 days of unused vacation, since 10 × 2.33 = 23.3 days.
Compensation calculation
You can directly determine the amount of compensation by multiplying your average daily earnings by the number of unused days of rest. The calculation of the average earnings at dismissal for compensation is very simple, but also has its own nuances. So, if the employee’s experience at the enterprise is 11 months, then the amount of payment should cover all 28 unused days of rest. Of course, the condition is relevant only if the employee has not taken part of the vacation during this period.
If at the time of dismissal a part of the paid vacation was used, then this number of days should be subtracted from the set at the time of calculation and only the remaining days should be paid. For example, an employee, having worked for six months, took 7 days of rest on account of the required vacation. At the time of dismissal, after 11 months from the moment of his admission, he should be compensated for 28 exits, but 7 of them have already been used. This means that upon dismissal, the employee will receive compensation for only 21 days.
If the dismissal is not due to the fault of the employee, then the company is obliged to compensate him for the entire annual vacation, even if only a few months have been worked out at that moment.
What is not taken into account in the calculation
Calculation of average earnings at dismissal is based on not all periods. If the employee was on vacation, on sick leave, on parental leave or used an extra weekend, such periods are not included in the calculations. Also, exceptions are periods of strikes and any downtime of the enterprise, in which there is no fault either of the managers or staff. These days must be taken away from the total working experience.
Payout Indexing
If during the billing period of work at the enterprise the employee increased the salary or tariff rate, then the calculation of average earnings will be completely different. The dismissal of an employee must be accompanied by full compensation, taking into account all the nuances. In this case, the average income should be indexed, that is, multiplied by the coefficient of salary increase for the entire billing period. The calculation of this coefficient is carried out by dividing the increased salary by the one that was previously.
For example, previously the employee’s income was 15,000 rubles, and after the increase it became 18,000. It takes 18,000 / 15,000 = 1.2 - the desired indicator. It is on the coefficient obtained in the calculation that in the future it is necessary to multiply the obtained average earnings for the calculation period, taking into account bonuses and allowances, but only those that are not tied to average earnings.
Fixed amounts are not indexed either, that is, you need to multiply the salary with those increments that are determined directly at the tariff rate in percentage terms.
Calculation Example
Taking into account all the possible nuances of accrual described above, an example of calculating the average earnings at dismissal is as follows.
For the data used, we take the full billing period per year, from which an employee received 20 thousand rubles for 8 months, then his salary rose to 30 thousand. During work for a low salary, the employee took sick leave for 15 days.
So, as the salary went up, the first step is to determine the increase factor. For this, 30 t. / 20 t. = 1, 5. Based on this indicator, all income for 12 months is determined, but first you need to determine the salary for that part of the month during which the sick-list was used.
So, 31 - 15 = 16 paid days. Further (16 × 20,000) / 31 = 10322 rubles per month with the sick-list.
Total income is (20,000 × 7 × 1,5) + (10322 × 1,5) + (30,000 × 4) = 345,483 rubles.
The total working days are (29.3 × 11) + (29.3 / 31 × 16) = 338.
Now the average daily earnings can be calculated 345483/338 = 1022 rubles.
Conclusion
It is very important to know exactly your average income when leaving the company. This helps to independently control the work of accounting and notice errors in a timely manner. Based on the average data, each employee receives compensation for unused vacation, severance pay upon dismissal, and payment of sheets for temporary disability. No social benefits should be considered.