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SEVERANCE PAY ENTITLEMENT

Martin George & Company > Laws of Trinidad and Tobago  > SEVERANCE PAY ENTITLEMENT

SEVERANCE PAY ENTITLEMENT

Severance pay is usually only paid to workers who have been made redundant or retirees, and in very rare cases, people who resign can also qualify. An employer is not required to pay severance to workers if everyone is being severed, owing to the fact that the business is being closed down; however, the employer must pay severance if only a portion of the workforce is being made redundant.

Firstly, according to Section 6 of the Retrenchment and Severance Benefits Act 1985, as amended, the employer is required to give the employees 45 days notice in writing.

Secondly, your rights (if you qualify):

Severance Benefit Entitlements in Trinidad and Tobago
18(1) Where any part of the employer’s retrenchment proposals is eventually put into effect, severance benefits shall be payable by the employer to the retrenched worker in accordance with this section.
(2) Where the retrenched worker is covered by a registered Collective Agreement, the terms of which with respect to severance benefits are no less favourable than those set out in this Act with respect to severance benefits, the provisions of the said Collective Agreement shall apply.
(3) Where the retrenched worker is not covered in the manner set out in subsection (2), the minimum severance benefits payable by the employer are as follows-
(a) where he has served the employer without a break in service for between more than one but less than five years, he is entitled for each such completed year of service to two weeks’ pay at his basic rate if he is an hourly, daily or weekly rated worker, or one half month’s pay at his basic rate if he is a monthly rated worker;
(b) where he has served the employer without a break in service for five years or more, he is in addition to his entitlement under paragraph (a), entitled for the fifth year and for each succeeding completed year of service to three weeks pay at his basic rate if he is an hourly, daily or weekly rated worker, or three-quarters month’s pay at his basic rate if he is a monthly rated worker.
(4) For each period of service amounting to less than a completed year of service and in respect of workers who qualify under section 5(1)(d), payment shall be calculated on a pro-rata basis.
(5) Every worker to whom this Act applies retrenched on or after 1st January, 1985, is entitled to the severance benefits contemplated by this section regardless of the number of workers in his employer’s work force.
(6) This section shall not apply to a retrenched worker who is eligible to receive from his employer terminal benefits that are no less favourable than those set out in this section.


—In order to qualify for this benefit the employee must fall within the definition of ‘worker’ in the Industrial Relations Act 1972, as amended, which says:

“worker”, subject to subsection (3), means— (a)any person who has entered into or works under a contract with an employer to do any skilled, unskilled, manual, technical, clerical or other work for hire or reward, whether the contract is expressed or implied, oral or in writing, or partly oral and partly in writing, and whether it is a contract of service or apprenticeship or a contract personally to execute any work or labour;

(b)any person who by any trade usage or custom or as a result of any established pattern of employment or recruitment of labour in any business or industry is usually employed or usually offers himself for and accepts employment accordingly; or

(c)any person who provides services or performs duties for an employer under a labour only contract, within the meaning of subsection (4)(b
The following are exceptions to the IRA’s definition of a worker:
workers with less than one year continuous service;
workers on probation;
casual workers;
seasonal workers;
fixed term workers;
independent contractors
The Retrenchment and Severance Benefits Act is one of a few pieces of legislation that allows the non-unionized individual worker who alleges non-compliance with the Act, to take his or her matter to the Industrial Court. The worker may take his or her complaint to the Minister of Labour where it is reported as a trade dispute and dealt with as such according to the provisions of the IRA.

An employer who contravenes the Act is guilty of an industrial relations offence and liable to a fine of $10,000.

Extracted From: Trinidad& Tobago Legal Rights

15 Comments

  • Kashmir mohammed
    Reply July 6, 2016 at 12:56 am

    Good day I am haveing problem to get my severance from OAS the company who was contract to build the highway.

    • Tianna Patterson
      Reply July 8, 2016 at 12:40 pm

      Hi Kashmir, for legal advice you can contact anyone of our offices to schedule an appointment to speak with one of our attorneys.
      You can also fill out our appointment form on our website.

      • MAGCO
        Reply January 3, 2017 at 8:08 pm

        Good Day Kashmir For legal consultation please contact any of our offices located at:

        #43 Dundonald Street Cor. Gordon & Dundonald Streets, Port of Spain, Trinidad.
        Tel: 624-7257 Tel/Fax:623-5187
        Cell:685-6301
        Email:mag4law@hotmail.com

        or

        #33 Bacolet Park, Scarborough, Tobago
        Tel: 639-1809
        Fax: 639-1579

  • Chery Ann
    Reply August 11, 2016 at 6:44 pm

    I am yet to receive a severance from a company I resigned from in march 2015. I got a call today stating that I will be getting part payment in Dec 2016. Also is severance taxable? at what bracket? and how long ago was this so?

    • Tianna Patterson
      Reply August 15, 2016 at 12:35 pm

      Hi Chery Ann, For legal consultation please contact any of our offices located at:

      #43 Dundonald Street Cor. Gordon & Dundonald Streets, Port of Spain, Trinidad.
      Tel: 624-7257 Tel/Fax:623-5187
      Cell:685-6301
      Email:mag4law@hotmail.com

      or

      #33 Bacolet Park, Scarborough, Tobago
      Tel: 639-1809
      Fax: 639-1579

  • Nekeisha
    Reply August 30, 2016 at 2:33 pm

    Hi my company is sellin and does not want to pay off workers way can we do

    • Michelle Thompson
      Reply May 3, 2017 at 1:02 pm

      Good Morning Nekeisha,

      For legal consultation please contact any of our offices located at:

      #43 Dundonald Street Cor. Gordon & Dundonald Streets, Port of Spain, Trinidad.
      Tel: 624-7257 Tel/Fax:623-5187
      Cell:685-6301
      Email:mag4law@hotmail.com

      or

      #33 Bacolet Park, Scarborough, Tobago
      Tel: 639-1809
      Fax: 639-1579

  • Andy Surujbally
    Reply January 3, 2017 at 2:16 pm

    I’ve worked for a company for 14 years. Started of as a trainee and moved up to Supervisory position. My salary was a meager $4400 per month at the time I resigned which was 6 years ago. Prior to my resignation I was made to hold 2 additional posts for an employee who had left and another who was on vacation. I cannot help but think that I was victimized and made to feel incompetent since the workload at the time was too much for me and a few errors were made. I was due for a raise in salary but was instead demoted which had a serious impact on the way I felt and by extension affected my work. I got no severance pay on any other money when I resigned. What can I do, I feel so cheated after all the years and hard work I put into this company.

    • Michelle Thompson
      Reply May 3, 2017 at 1:01 pm

      Good Morning Andy,

      For legal consultation please contact any of our offices located at:

      #43 Dundonald Street Cor. Gordon & Dundonald Streets, Port of Spain, Trinidad.
      Tel: 624-7257 Tel/Fax:623-5187
      Cell:685-6301
      Email:mag4law@hotmail.com

      or

      #33 Bacolet Park, Scarborough, Tobago
      Tel: 639-1809
      Fax: 639-1579

  • Andy
    Reply January 3, 2017 at 2:17 pm

    I’ve worked for a company for 14 years. Started of as a trainee and moved up to Supervisory position. My salary was a meager $4400 per month at the time I resigned which was 6 years ago. Prior to my resignation I was made to hold 2 additional posts for an employee who had left and another who was on vacation. I cannot help but think that I was victimized and made to feel incompetent since the workload at the time was too much for me and a few errors were made. I was due for a raise in salary but was instead demoted which had a serious impact on the way I felt and by extension affected my work. I got no severance pay on any other money when I resigned. What can I do, I feel so cheated after all the years and hard work I put into this company.

  • marlon
    Reply May 1, 2017 at 2:56 pm

    hi have worked with a company for 11 year and they are calling me a causal worker after all those year is that true

  • Kathryn
    Reply May 9, 2017 at 3:14 pm

    Are employees entitled to any benefits on the closure of a company, and if they were told that on the sale of the assets they would be given something, how long that takes.

    • Michelle Thompson
      Reply May 10, 2017 at 12:23 pm

      Good Morning Kathryn,

      For legal consultation please contact any of our offices located at:

      #43 Dundonald Street Cor. Gordon & Dundonald Streets, Port of Spain, Trinidad.
      Tel: 624-7257 Tel/Fax:623-5187
      Cell:685-6301
      Email:mag4law@hotmail.com

      or

      #33 Bacolet Park, Scarborough, Tobago
      Tel: 639-1809
      Fax: 639-1579

  • Garvin
    Reply June 21, 2018 at 6:18 pm

    Hi gde I have a vsep agreement with my ex employer where we agreed on payment to be paid every week but the company is not paying per the agreement and giving trouble to pay I have a copy of the agreement what can I do to solve this issue

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