DISCOVER
×

How to calculate notice pay

Updated February 21, 2017

Notice pay, also known as pay in lieu of notice, is money you pay an employee who is being let go. Rather than giving him two weeks' notice of dismissal or layoff, you simply pay him for two weeks and let him leave. Of course, if you are required to give employees more than two weeks' notice, the amount of notice pay will be more than two weeks' compensation. Calculating notice pay is a matter of simple arithmetic.

Divide the annual salary by 52.

Multiply the resulting figure by the requisite number of weeks. For example an employee who earns £33,800 per year and is entitled to two weeks' notice pay should receive £1,300. Consider £33,800 / 52 = £650. £650 X 2 = £1,300.

Divide monthly salary figure by 30, and multiply the result by the requisite number of days. If your employee is paid by the month, rather than by the year, the calculation comes down to days rather than weeks. For example, you have an employee who earns £1,950 per month and is entitled to two weeks' notice. Divide £1,950 by 30 to get £65 per day. Then, expressing the number of weeks in terms of days, multiply £65/day by 14 days. The employee should receive £910 in notice pay.

Things You'll Need

  • Calculator
bibliography-icon icon for annotation tool Cite this Article

About the Author

D. Laverne O'Neal, an Ivy League graduate, published her first article in 1997. A former theater, dance and music critic for such publications as the "Oakland Tribune" and Gannett Newspapers, she started her Web-writing career during the dot-com heyday. O'Neal also translates and edits French and Spanish. Her strongest interests are the performing arts, design, food, health, personal finance and personal growth.