The rules on severance pay in detail

The employer is not obliged to pay any termination or severance compensation for lawful termination of the contract.

However, the employer is obliged to observe a notice period, and the employee is entitled to full pay during this time. The notice period can be up to six months, depending on the duration of the employment relationship prior to termination, or depending on a specific agreement regarding the notice period, if one applies.

In cases of unlawful termination that end up in court, the court has the discretion to order up to 24 months’ salary, although typically, it will order between 6 and 15 months’ salary.

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Author: Dittmar & Indrenius

Date: December 2018


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