Severance Pay Calculator
Estimate a severance package from your weekly pay, years of service and the weeks-per-year formula on offer — and see what levers you may be able to negotiate.
Reviewed by the CalcCafe editorial team · Last updated 18 July 2026 · How we test our tools
Example
An employee earning $1,500 a week is laid off after 8 years. The employer offers 2 weeks of pay per year of service plus 4 extra flat weeks: 8 × 2 + 4 = 20 weeks of pay. At $1,500 a week that is a severance estimate of $30,000 before taxes — roughly four and a half months of income to bridge the job search. Withholding applies, so the take-home amount will be noticeably lower.
How it works
Total weeks = years of service × weeks offered per year + any extra flat weeks in the base offer. Severance estimate = total weeks × weekly pay. If you are salaried, weekly pay is annual salary ÷ 52 (a $78,000 salary is $1,500 a week). The weeks-per-year figure comes from your employer's offer or policy — 1 to 2 weeks per year of service is the most common range, and some offers include a flat base (for example, 4 weeks for everyone) on top of the tenure formula. The result is gross pay: federal and state income tax, Social Security and Medicare are withheld from severance just like regular wages, and lump sums are often withheld at the supplemental-wage rate.
Good to know
There is no federal law requiring severance pay in the United States. The Fair Labor Standards Act (FLSA) mandates final wages for time worked, but severance itself is a matter of company policy, an employment contract, or negotiation — which is why packages differ so much between employers and even between employees at the same company.
Common formulas cluster around 1 to 2 weeks of pay per year of service for rank-and-file roles, with senior managers and executives often receiving 3 to 4 weeks per year, multi-month minimums, or change-of-control terms set in their contracts. Separately, the federal WARN Act requires employers with 100 or more employees to give 60 days' advance notice of mass layoffs or plant closings — some employers pay 60 days of wages in lieu of notice, which arrives alongside, not instead of, any severance offer.
Severance is almost always paid in exchange for signing a separation agreement that waives your right to sue. For workers 40 and over, the ADEA (via the Older Workers Benefit Protection Act) requires at least 21 days to consider a waiver of age-discrimination claims (45 days in group layoffs) and 7 days to revoke after signing. Severance can also interact with unemployment benefits: depending on your state, a lump sum or salary continuation may delay or reduce unemployment payments, so check your state's rules before assuming you can collect both at once.
Offers are more negotiable than most people assume. Levers include more weeks, COBRA health-premium coverage or a healthcare stipend, a later termination date (extending vesting or bonus eligibility), payout of accrued PTO, outplacement services, a neutral reference, and narrowing non-compete or non-disparagement terms. Leverage is highest when you have potential legal claims, long tenure, or institutional knowledge the employer needs during transition — and an employment attorney can usually tell you quickly whether the offer is worth signing as-is.
Frequently asked questions
Is severance pay required by law in the US?
No. No federal law forces employers to pay severance — the FLSA only requires payment of wages already earned. Severance comes from company policy, an employment contract, or negotiation. The WARN Act can require 60 days' notice of mass layoffs at larger employers, but notice is not the same thing as severance.
What is a typical severance package?
One to two weeks of pay per year of service is the most common formula, sometimes with a flat base of a few weeks added. Executives often negotiate three to four weeks per year, multi-month minimums, or change-of-control packages defined in their contracts.
Is my data uploaded anywhere?
No — this calculator runs entirely in your browser. Your pay and tenure figures never leave your device, and nothing is stored on any server.
Is this severance calculator free?
Yes — completely free with no sign-up. Run as many offer scenarios as you like, for example comparing 1, 1.5 and 2 weeks per year of service.
People also ask
Is severance pay taxed?
Yes. Severance is taxable wages: federal and state income tax, Social Security and Medicare are all withheld. Lump sums are often withheld at the flat supplemental-wage rate, which can make the check look smaller than expected — the final tax is settled on your return.
Can I get unemployment benefits if I receive severance?
It depends on your state. Some states pay unemployment immediately regardless of severance, others delay benefits during the weeks your severance covers, especially with salary continuation. File promptly and let your state agency apply its rule.
How long do I have to consider a severance agreement?
If you are 40 or older, federal law requires at least 21 days to consider an agreement that waives age-discrimination claims (45 days in group layoffs) and 7 days to revoke after signing. Younger workers have no fixed federal minimum, but employers commonly allow a review period — use it to get legal advice.
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Sources & references
These tools follow our methodology and provide educational estimates only — verify important figures with a qualified professional.