Terminal Benefits Calculator

15 Days Salary
Years Worked
Terminal Benefits

This tool helps you determine terminal benefits calculation in Zambia. Terminal benefits is a lump sum payment made to an employee on termination of employment on medical grounds.

How are terminal benefits calculated in Zambia? According to the Employment Act, section 40 (1) (g) specifies severance pay at the rate of not less than 15 days pay for each completed year of service with the same employer. This means that severance pay is calculated by multiplying 15 days' salary by the number of years that an employee has rendered services to an employer. But you can use our website to calculate terminal benefits within minutes. Its the best platform for terminal benefits calculation in Zambia, Kenya, Uganda and Nigeria.
  • Steps to calculate terminal benefits
  • (1) Enter your 15 days salary
  • (2) Enter number of years worked
  • (3) Check your calculated terminal benefits

Terminal Benefits means the gratuity, pension, dearness and other applicable relief and other applicable benefits including the right to have the appropriate revisions in the above benefits consistent with the practice that were prevalent in the Department. Upon termination, an employee is entitled to be paid any salary/wages which due to him/her at the time of termination. All payments accruing to the employee which are wrongfully withheld or deducted must be paid upon termination.
What are termination benefits? In general, termination benefits may be provided to an employee as a result of either a voluntary or involuntary early termination of services. Termination benefits are those that are over and above the normal benefits (e.g., vacation pay, standard health care)

How is severance calculated in Zambia?. Permanent employees are also entitled to severance pay in the form of gratuity at the rate of 25% of the basic salary earned at end of the employment relationship. However this benefit only accrues from 9th May 2020 which is one year from the date the Employment Code Act came into effect. Employees are entitled to “a minimum redundancy payment of not less than two months' pay for every year served and other benefits the employee is entitled to as compensation for loss of employment.
Are terminal benefits taxable in Zambia? With effect from 1st April 2001, a lump sum payment made to an employee on termination of employment on medical grounds, is exempt from tax. Settling in allowances, or whatever name called, paid to new employees and employees on transfer constitute emoluments and should be subjected to tax under the VAT and PAYE scheme.

What are termination benefits? In general, termination benefits may be provided to an employee as a result of either a voluntary or involuntary early termination of services. Termination benefits are those that are over and above the normal benefits (e.g., vacation pay, standard health care coverage, etc.).
Liable termination payments include: payments relating to unused annual leave, sick leave, long service leave, or a bonus or leave loading. act of grace redundancy payments (golden handshakes) paid to employees after termination. act of grace redundancy payments paid to directors and contractors.
Difference between severance pay and service pay While termination pay is the minimum amount a person can receive when their employer fires them, severance pay is the full amount. As with termination pay, the longer the employment relationship, the greater the severance pay.