Severance pay calculator for Germany: A guide for your specific legal case

Our free severance pay calculator allows you to get a rough overview of what amount of severance pay is likely in your specific case within a few minutes. We have specially mapped a (even quite large) range in which 90% of all severance payments are located. Of course, there are exceptions in one direction (less money) as well as in the other (more money). In addition, the final sum you receive is, of course, contingent on your negotiation abilities, or those of your attorney. As each situation is unique, obtaining legal consultation to explore the details of your specific case can be beneficial. Our partner lawyers offer a free initial consultation for this purpose – only then do you decide whether you want to proceed with a lawyer or “on your own”.

Rough rule of thumb for calculating the settlement amount

A general guideline to estimate your severance pay in Germany is by following this equation: Monthly salary x Years of service x Factor (ranging from 0.5 to 1.2). There can be deviations, yet typically, if the computation involves the factor 0.5, your severance pay might be on the lesser side. If the factor is close to or even above 1.0, your settlement amount is at the upper end of the possible range. You can also see an overview of the standard severance pay in the following table – the principle is also reflected in our severance pay calculator.

Calculate severance pay: Procedure and which prerequisite should be fulfilled

Of course, you can also calculate your rough severance pay yourself. Basically, two basic conditions should be met for the calculation of the severance payment amount, for example, after a dismissal:

• Length of service longer than 6 months (probationary period ended) → more details on why this is so can be found here (Dismissal Protection Act).

• Number of employees in the company more than 10 → more information on protection against dismissal in small companies.

• If notice of termination has already been given, the notice must not have been received more than 3 weeks ago → more information on the missed deadline for filing an action after a notice of termination.

If these points are fulfilled, you can use the following formula to calculate the standard severance pay: Standard severance pay = factor 0.5 * gross monthly salary * years of service with the company.

In addition, some information on the monthly gross salary. The following forms of remuneration also count here:

• Bonus payments
• Bonuses
• Holiday pay
• Christmas bonus
• Cash benefits
• Company pension scheme
• Commissions
• Company car

The decisive variable component in the calculation of the severance payment amount is the factor; here there is sometimes considerable leeway for adjusting the amount of your severance payment. What does the factor depend on when calculating the severance payment? Conditions that favour a higher severance payment above the standard severance payment are, for example:

• Your Age: under 40 = 0.5, 40 -49 = 0.75, over 50 =1.0
• Do you have Children?
• Member of the works council
• On parental leave or shortly before/after
• Do you have a disability?

Calculation of the settlement amount: Example calculation

Mr. Müller negotiates a termination agreement with his employer – his monthly salary is 4,000€. In addition, Mr. Müller has been working for the company for 4 years. What severance amount should he negotiate?

Standard severance pay: 0.5 * 4,000 (monthly salary) * 4 (years of service) = 8,000 €.

The standard severance pay is the minimum that Mr Müller should demand. In many cases, the severance payment can even be significantly higher. In our severance pay calculator we show a range between 0.5 and 1. In the case of Mr Müller this would be a potential severance pay of between €8,000 and €16,000.

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