Article 84 explains the general end-of-service benefit calculation when an employment relationship ends. It is one of the most important articles for HR and payroll teams because it directly affects final settlement.
Article 84 calculation in simple terms
Key points HR teams should understand
1. First five years
For each of the first five years of service, the employee is generally entitled to half a month’s wage as part of the end-of-service calculation.
2. Years after the first five years
For each year after the first five years, the calculation changes to one month’s wage for each year.
3. Last wage is the calculation basis
Article 84 uses the worker’s last wage as the basis for calculating the end-of-service award. HR should confirm the correct last wage before preparing the final settlement.
4. Partial years are calculated proportionally
If the employee has worked for part of a year, the end-of-service award should be calculated proportionally for that period.
Simple example
If an employee worked for 6 years, Article 84 generally means:
- First 5 years: half-month wage for each year.
- 6th year: one-month wage.
- Total award depends on the employee’s last wage.
HR checklist for Article 84
- Confirm joining date and last working date.
- Calculate the exact service period.
- Confirm the employee’s last wage.
- Check whether the case is termination, contract expiry, resignation or another reason.
- Review if Article 85 applies for resignation cases.
- Prepare final settlement and employee acknowledgement.
Article 84 vs Article 85
Article 84 gives the general end-of-service calculation. Article 85 is important when the employment relationship ends because of resignation, because resignation cases may have different entitlement percentages depending on service period.
How Havvi HR helps
Havvi HR helps HR teams maintain employee records, joining dates, salary information, payroll data and documents. This makes final settlement and end-of-service review easier and more organized.
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