Entitlement to severance pay upon termination of employment

According to § 76a(2) of Act No. 311/2001 Coll. of the Labour Code (hereinafter referred to as the “Labour Code”): “An employee is entitled to a retirement allowance in the amount of at least their average monthly earnings if they have been granted an early old-age pension based on an application submitted before the termination of employment or within ten days after its termination.”

The employer is not obliged to provide a retirement allowance if the employment relationship ended under § 68(1) of the Labour Code, which allows for immediate termination by the employer only in exceptional cases, such as:

The employee is entitled to a retirement allowance of at least the amount of their average monthly earnings, but the employer may grant a higher amount, for example, if such a condition is specified in a collective agreement.

The employee must submit a confirmation from the Social Insurance Agency confirming the granting of the early old-age pension. The employer is not obliged to pay the retirement allowance before receiving this confirmation.

The retirement allowance is granted only from one employer and, according to § 118 of the Labour Code, it is not considered a wage.

According to § 75(2)(e) of the Labour Code: “Upon termination of employment, the employer is obliged to issue a certificate of employment, stating in particular whether a retirement allowance under § 76a was provided. If the allowance is paid later, the employer must issue a new certificate.”

If you need precise information about your entitlement to a retirement allowance, our law firm offers consultations or a detailed legal analysis of your situation. Our experts will help evaluate whether you meet the conditions and determine the appropriate amount. We will also take the necessary legal steps against the employer if the allowance is denied.

Hello, Regarding severance pay, § 76a (2) of Act No. 311/2001 Coll., the Labour Code (hereinafter referred to as the “LC”), states that “an employee is entitled to severance pay in the amount of at least their average monthly earnings upon termination of employment, if they were granted early retirement based on an application submitted before the termination of employment or within ten days after its termination.”

It should also be noted that “severance pay is granted to the employee by only one employer (§ 76a (3) LC).” However, an employee is not entitled to severance pay if the employer terminated the employment immediately due to a serious breach of work discipline (§ 76a (4) LC).

If you intend to claim severance pay from your employer, you must also submit (or deliver) the decision of the Social Insurance Agency, proving that you applied for early retirement.

While severance pay is considered a “reward” for work performed for a particular employer, redundancy pay (odstupné) is generally paid to the employee when the employer terminates the employment through a notice (§ 76 LC).

Severance pay if the employee continues working after reaching retirement age and does not interrupt the employment relationship

When assessing the entitlement to severance pay, it is important to note that severance pay according to the Labour Code (LC) is granted to an employee only “upon the first termination of employment after the entitlement to old-age pension or disability pension with a loss of earning capacity of more than 70% (§ 76a (1) LC).” The employer will pay the severance pay in the amount of the average monthly earnings provided that the employee applies for the pension before the termination of employment or within 10 working days after its termination.

If the employee does not interrupt their employment after reaching retirement age, they are not entitled to severance pay. This entitlement is therefore exclusively linked to the first termination of employment after obtaining pension status and does not arise simply by obtaining pension status. The entitlement to severance pay arises for the retiree only when they terminate their employment.

As a side note, it is worth mentioning that “severance pay is granted to the employee from only one employer (§ 76a (3) LC).”

Hello, In accordance with Section 76a, Paragraph 1 of Act No. 311/2001 Coll., the Labour Code (hereinafter referred to as the “LC”): “An employee is entitled to a retirement benefit at the first termination of an employment relationship after the entitlement to an old-age pension or an invalidity pension arises, if the decrease in the ability to perform gainful activity is more than 70%, in an amount at least equal to their average monthly earnings, if they apply for the provision of the said pension before the termination of the employment relationship or within ten working days after its termination.”

It clearly follows from the cited provision that the entitlement to a retirement benefit arises for an employee at the first termination of the employment relationship only if they apply for the provision of the pension before the termination of the employment relationship or at least within 10 working days after its termination. For the assessment of the existence of the entitlement to a retirement benefit in your case, it is therefore crucial to know the exact date of submission of the application for the granting of the pension (whether you applied for it within the legally stipulated interval). However, given the fact that the pension was granted to you only on November 2, 2024, it can be assumed that you applied for the granting of the pension more than 10 working days after the day you terminated your employment relationship (May 31, 2023), and therefore, most likely, no entitlement to a retirement benefit arises for you.