Private sector employers and employees
Telephone: 1300 655 266
Locked Bag 100
East Perth WA 6892
This information is only relevant to employers and employees in the WA state industrial relations system – sole traders, unincorporated partnerships, unincorporated trusts and some incorporated or not for profit organisations. Find out more on the Guide to who is in the WA state system page.
If you operate or are employed by a Pty Ltd business – you can find information on this topic on the Fair Work Ombudsman website.
The entitlement to redundancy payments can depend upon the WA award that applies. Please check the WA award summaries or contact Wageline for information on redundancy provisions under the relevant WA award.
When an employee has been made redundant they are entitled to receive:
Further information regarding the payout of long service leave on termination can be found on the Long service leave page.
Severance pay does not generally apply to businesses with less than 15 employees (including casual and part time employees). However, some WA awards have specific severance pay requirements that apply to all businesses, including those with less than 15 employees. The WA awards listed below do not exclude businesses with less than 15 employees from making severance payments, so if one of these awards cover the employment the award's redundancy provisions will need to be checked:
Employers are also not generally required to make severance payments to the following employees:
However, some WA awards have specific severance pay provisions that do apply to one or more of the employee groups listed above. If an employer is covered by one of these awards, the employer will need to make severance payments in accordance with the award.
The amount of severance pay depends on how long the employee has worked for the business, as shown in the following table:
|Period of continuous service*||Minimum number of weeks pay|
|Less than 1 year||Nil|
|1 year and less than 2 years||4 weeks|
|2 years and less than 3 years||6 weeks|
|3 years and less than 4 years||7 weeks|
|4 years and less than 5 years||8 weeks|
|5 years and less than 6 years||10 weeks|
|6 years and less than 7 years||11 weeks|
|7 years and less than 8 years||13 weeks|
|8 years and less than 9 years||14 weeks|
|9 years and less than 10 years||16 weeks|
|10 years and over||12 weeks|
* An employee’s period of continuous service includes any service with that business under a previous employer where there has been a transmission of the business. A transmission of business can occur when one employer sells a business (or part of a business) to another employer, and may also occur in other ways, including by succession or assignment. Where there has been a transmission of business, an employer will need to include any period of service with that business that an employee has had under a previous employer when calculating the period of continuous service for purposes of severance payments.
The table above shows the minimum severance payments, and these override any lesser amount specified in a WA award. If the WA award specifies a higher severance payment, the greater entitlement must be paid.
The calculation of redundancy pay is based on the applicable number of weeks' severance multiplied by ordinary time earnings. Ordinary time earnings excludes overtime, penalty rates, disability allowances, shift allowances, special rates, fares and travelling time allowances, bonuses, and any other ancillary payments of a like nature.
If the employee resigns during the notice period, he or she is entitled to the same severance pay they would receive if they had worked until the end of the notice period. However, in this circumstance the employee is not entitled to payment in lieu of notice.
Employers can apply to the Western Australian Industrial Relations Commission to have the severance payment varied if they:
All state system employers are legally required to keep employment records that detail time worked, leave taken and pay received by employees.
Learn more on the Employment records - Employer obligations page