Is an employee who retires entitled to severance pay?

Verified 17 November 2025 - Public Service / Directorate of Legal and Administrative Information (Prime Minister)

When you retire, you can receive compensation from your employer. The terms and conditions of this allowance vary depending on whether you decide to retire or whether your employer automatically retires you. We present these conditions of attribution.

Employee's request

You are entitled to severance pay if you voluntarily leave your company to retire and if you have at least 10 years of service in the company.

Severance pay is commonly called retirement bonus.

The severance pay can only be granted once. It is granted when you apply for your basic retirement pension from the pension fund you are entitled to when you retire.

Please note

When you apply to retire, you must respect a advance notice whose duration is identical to that of notice in the event of dismissal.

Depending on your length of service in the company, your retirement benefit may not be less than the following statutory amount:

Tableau - Minimum amount of the retirement benefit in the event of voluntary departure

Seniority of the employee

Amount of compensation

10 years minimum and under 15 years

1/2 month salary

15 years minimum and under 20 years

1 month salary

20 years minimum and under 30 years

1 month and a half salary

At least 30 years

2 months salary

The salary used to calculate your allowance is, depending on what is most advantageous to you:

  • Or the 12the of your gross remuneration for the last 12 months preceding your retirement
  • That's one third of your gross compensation for the last 3 months. In this case, any bonus or other element of annual or exceptional salary paid during these 3 months is recalculated over 3 months. For example, if you received an annual bonus of €550, it will be taken into account up to €137.50 (550 / 12 x 3).

A company or establishment agreement or arrangement or convention or a collective agreement may provide for more favorable amounts.

A simulator is used to determine the amount of the allowance based on the collective agreement to which the company is attached:

To know the amount of compensation to which an employee who retires may be entitled

If you worked full-time and part-time in the same company, the allowance is calculated in proportion to the length of time you worked full-time and part-time.

Example :

You worked 11 years in your company, 9 years full-time and then 2 years part-time.

The most advantageous gross salary to calculate your severance pay is €1,200 part-time, or €2,400 full-time.

Your severance pay will be calculated based on the following salary: (2,400 x 9 / 11) + (1,200 x 2 / 11) = 2,181.82 and will therefore be equal to €1,090.91 (2,181.82 / 2).

A company or establishment agreement, or a branch agreement or agreement, may provide for the possibility of using the severance payment to keep you fully or partially paid if you apply for part-time (or reduced-time) work at the end of your career.

If the amount of the severance pay is greater than the amount necessary to maintain your remuneration, the remainder is paid to you.

Voluntary Retirement Compensation is submitted contributions (social security contributions, CSG: titleContent and CRDS: titleContent) unless you decide to retire as part of a job protection plan (PES).

It is taxable on income.

In addition to your voluntary retirement benefit, you can receive the following amounts (if you meet the conditions to receive it):

Decision of the employer

If your employer decides about you automatically retire, you are entitled to a retirement benefit.

Please note

You are also entitled to a advance notice whose duration is identical to that of notice in the event of dismissal.

The amount of your retirement benefit may not be less than the following legal amount, depending on your seniority in the company:

  • ¼ month's salary per year of service for the first 10 years
  • ⅓ months of salary per year of service from 11e year.

The salary taken into account to calculate the allowance, called reference salary, is, according to what is most advantageous to you:

  • This is the average monthly salary for the last 12 months before the day the letter of retirement was sent
  • That's one-third of your salary in the last three months. In this case, any bonus or other element of annual or exceptional salary paid during these 3 months is recalculated over 3 months. For example, if you received an annual bonus of €550, it will be taken into account up to €137.50 (550 / 12 x 3).

A collective agreement may provide for more favorable amounts.

Your seniority is calculated until the effective date of termination of your employment contract, i.e until the end of the notice, even if it is not accomplished.

If your seniority includes an incomplete year, the allowance is calculated in proportion to the number of full months.

Example :

For a seniority of 12 years and 9 months and a reference salary of €2,200, the minimum allowance shall be: [(2 200 x 1/4) x 10] + [(2 200 x 1/3) x 2 ] + [(2 200 x 1/3) x (9/12)] = €7,516.67.

If you worked full-time and part-time in the same company, the allowance is calculated in proportion to the length of time you worked full-time and part-time.

Example :

You have worked 5 years in your company including 3 years full time, then 2 years part time.

Your reference salary is €1,500 part-time, or €3,000 full-time.

The amount of your allowance is calculated as follows: (3,000 x 1/4 x 3) + (1,500 x 1/4 x 2) = €3,000.

Social contributions

Depending on the amount, your retirement benefit is submitted contributions (social security contributions, CSG: titleContent and CRDS: titleContent) under the following conditions:

  • If it is less than €471,000, it shall be exempt from social security contributions on the part of its amount less than €94,200
  • If it is greater than €471,000, it is fully subject to social security contributions
  • The portion of your compensation less than €94,200 is exempt from CSG and CRDS
  • The portion of your compensation greater than €94,200 is fully subject to CSG and CRDS (without 1.75%).

Income tax

Your retirement benefit is partly exempt from income tax.

The portion of your retirement benefit that is exempt from income tax is the most advantageous of the following 3 amounts:

  • Minimum legal amount or amount provided for in the agreement or collective agreement
  • Or 2 times the amount of gross annual compensation you received in the year preceding your retirement, up to €231,840 (for a retirement benefit received in 2024)
  • Or 50% the amount of your retirement benefit up to €231,840 (for a retirement benefit received in 2024).

In addition to your retirement benefit, you can receive the following amounts (if you meet the conditions to receive it):

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