If you are presented with a severance calculation in Mauritius, there is one thing worth checking above all others.
The two computations
For severance, a month's remuneration is the higher of:
- The remuneration drawn for the last complete month of full-time employment
- An amount calculated to give the monthly rate over the 12 months before termination, including payment for extra work, productivity bonus, attendance bonus, commission for services and any other regular payment
The Act says whichever is higher. Both must be worked out and compared.
Why the second often wins
Because it captures variable payments that the last-month figure may miss entirely.
If you receive commission, attendance bonuses or regular overtime, and your final month happened to be a quiet one, the twelve-month computation could produce a considerably higher figure.
A settlement calculated only on the last month, without the comparison, may be understated.
What can be deducted
Severance may be reduced where the employer has granted a gratuity, contributed to a fund or scheme, or contributed to the PRGF.
Ask for that deduction to be itemised. It should be a specific figure, not a general reduction.
Was the reduction justified?
If a workforce reduction is found unjustified by the Redundancy Board, severance rises to three months' remuneration per year of service, or the Board may order reinstatement with your consent.
That is a very different outcome from a standard settlement, and it depends on the Board's finding.
Your checklist
- Were both computations done and compared?
- Were bonuses, commission and extra work included in the twelve-month figure?
- Is any deduction for PRGF or a scheme itemised?
- Has the reason for the reduction been established?
- Are PRGF contributions up to date to the termination date?
Where to go
The Ministry of Labour and Industrial Relations. Bring payslips covering the full twelve months — they are what the second computation rests on.