An employee who retires after thirty years in the same company and another who leaves after twelve years do not receive the same amounts on their final payslip at all. The difference lies in a few lines of the final settlement, but those lines contain most of the errors and disputes.
Understanding what goes into the calculation, and especially what changes depending on whether the departure is initiated by the employee or the employer, helps avoid discovering a loss of earnings once the receipt is signed.
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Voluntary departure or retirement imposed by the employer: the gap that changes everything on the final settlement
The two situations are often confused because the visible result is the same (the employee leaves the company), but the financial treatment diverges significantly. According to Juritravail, in the case of a voluntary retirement, the legal indemnity is only due after ten years of service, with an amount ranging from half a month to two months of salary depending on the thresholds.
In the case of retirement imposed by the employer, the indemnity is at least equal to the legal severance pay, which is a quarter of a month’s salary for each of the first ten years, and then a third of a month for each year thereafter. Over a long career, the gap between the two regimes can represent several months of salary.
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Before checking the amounts on a receipt, it is therefore essential to precisely identify the initiative behind the departure. This criterion determines the calculation basis for the final settlement upon retirement and the applicable indemnity regime.
Retirement departure indemnity: calculation method based on seniority
The calculation is based on two variables: the reference salary and seniority. The reference salary considered is the most favorable between the average of the last twelve months and that of the last three months (including prorated bonuses).
Voluntary departure of the employee
The legal indemnity follows seniority thresholds. The Labor Code provides for half a month’s salary after ten years, one month after fifteen years, one and a half months after twenty years, and two months after thirty years. No legal indemnity is due below ten years of seniority.
Retirement imposed by the employer
The scale of the legal severance pay is applied: a quarter of a month per year for the first ten years, and a third of a month per year thereafter. This scale is a minimum. The collective agreement may provide for a higher amount, and the most favorable one applies. On this point, feedback varies from one sector to another: some metallurgy or construction agreements grant significant increases.
The other lines of the final settlement upon retirement
The departure indemnity is just one component. The final settlement receipt must list all amounts still owed. Here are the items to check line by line:
- The salary for the last month worked, calculated pro-rata based on actual days if the departure occurs mid-month, including bonuses
- The compensatory indemnity for paid leave, corresponding to the days of leave accrued but not taken at the time of contract termination
- The compensatory indemnity for notice, if the employer exempts the employee from serving their notice period (the duration varies according to seniority: the Ministry of Labor’s simulator distinguishes different durations for voluntary departure and retirement)
- Any possible outstanding amounts: unpaid overtime, prorated performance bonuses, redeemable employee savings, unused time savings account
A common oversight concerns RTT or compensatory rest days accumulated. These days must appear on the final settlement receipt and be compensated if they have not been taken.
Retirement notice: durations and common pitfalls
The notice period is often underestimated even though it determines the effective end date of the contract, and thus the calculation of the retained seniority. The official simulator of the Labor Code clearly distinguishes the durations based on the initiative of the departure and the employee’s seniority.
For a voluntary departure, the notice period is generally aligned with that provided in the case of dismissal (one to two months depending on seniority), unless there is a different collective provision. For a retirement imposed by the employer, the rules of dismissal apply directly.
The most common pitfall: not checking if the collective agreement extends the notice period. A contractual notice of three months instead of two shifts the exit date, adds seniority to the count, and can push the employee into a higher indemnity tier. It is advisable to consult the collective agreement before setting the departure date.
Check and contest the final settlement receipt
The employer provides the final settlement receipt at the time of termination. The employee has a period of six months to contest it after signing. After this period, the receipt becomes liberating for the employer regarding the amounts listed.
In practice, three checks are sufficient to spot the majority of errors:
- Recalculate the departure indemnity by applying the legal scale and the collective scale, then retain the most favorable
- Compare the number of paid leave days compensated with the actual balance displayed on the last payslip
- Verify that all prorated bonuses (thirteenth month, seniority bonus, profit-sharing) are correctly listed on the receipt
Not signing the receipt immediately allows time to check each line. The signature is not mandatory to receive the amounts owed: the employer must pay the balance even in the absence of a signature.
Retirement preparation begins several months in advance, but the final settlement should be verified in the days following the receipt of the document. Keeping a copy of the last payslip, the receipt, and the applicable collective agreement remains the most useful reflex to defend one’s rights if an item is missing or if a calculation does not add up.