What does the final settlement include?
At a minimum, it includes the last month’s salary and pay for leave earned but not taken; severance pay is added when it is due.
- the last month’s salary, prorated up to the leaving date, with overtime and bonuses;
- pay in lieu of paid leave;
- severance pay, for a CDI ended by the employer after six months;
- bonuses earned at the leaving date;
- deducted: unpaid advances and loans, within the limits of article 386.
More favourable terms in a contract or collective agreement always prevail.
How do you calculate pay for untaken leave?
Leave earned and not taken is paid at the salary the employee would have received had they worked, including extras (articles 249 and 250).
Leave accrues at 1.5 working days per month (article 231), plus 1.5 days per five-year period of seniority, up to 30 days a year (article 232). After six months of service, the pay also covers leave from the two previous years, and a month started counts as a full month (article 251).
Example. An employee paid 5,200 DH a month leaves with 12 untaken days. With the 26-day divisor common in payroll practice (article 238), her day is worth 200 DH and her pay in lieu 2,400 DH.
How many hours of salary per year for severance pay?
| Years of service | Hours of salary per year | Total at the end of the band |
|---|---|---|
| 1 to 5 years | 96 hours | 480 hours |
| 6 to 10 years | 144 hours | 1,200 hours |
| 11 to 15 years | 192 hours | 2,160 hours |
| Over 15 years | 240 hours | 2,160 hours + 240 per additional year |
1 to 5 years
- Hours of salary per year
- 96 hours
- Total at the end of the band
- 480 hours
6 to 10 years
- Hours of salary per year
- 144 hours
- Total at the end of the band
- 1,200 hours
11 to 15 years
- Hours of salary per year
- 192 hours
- Total at the end of the band
- 2,160 hours
Over 15 years
- Hours of salary per year
- 240 hours
- Total at the end of the band
- 2,160 hours + 240 per additional year
Article 53 of the Labour Code: hours of salary owed per year or part-year of actual work, each year paid at its band’s rate.
How do you calculate severance pay in Morocco?
Multiply the hours owed for the employee’s seniority by the average hourly wage of the last 52 weeks. It is owed to a CDI employee dismissed after six months (article 52). The base includes salary and extras, never below the SMIG (articles 55 and 56); it is increased by 100% for staff representatives (article 58).
Example. 8 years of service at 30 DH an hour:
- years 1 to 5: 5 × 96 = 480 hours;
- years 6 to 8: 3 × 144 = 432 hours;
- total: 912 hours × 30 DH = 27,360 DH, doubled for a staff delegate.
Is severance pay taxable?
For IR, no, up to 1,000,000 DH, together with voluntary departure pay and damages awarded by a court (CGI article 57-7°).
CNSS (order n° 1314.25):
- severance pay and damages resulting from conciliation before the labour inspector, a court decision or an arbitration award: excluded up to 1,000,000 DH;
- voluntary departure and retirement payments: excluded up to 2,080 times the hourly SMIG, i.e. 37,273.60 DH in 2026.
For a payment made directly, have the CNSS treatment confirmed. Pay in lieu of leave, on the other hand, is salary: gross, CNSS base and taxable.
How do you prepare a final settlement, step by step?
- 1
Set the leaving date
It closes the count of days worked, leave earned and seniority.
- 2
Close the last month’s hours
Punches, absences and overtime by rate up to the leaving date.
- 3
Check the leave balance
Days earned, seniority days, days taken and carry-overs.
- 4
Calculate the payments
Untaken leave and severance where applicable, on the average of the last 52 weeks.
- 5
Deduct what is still owed
Unpaid advances and loans, within the limits of the Labour Code.
- 6
Recover equipment and hand over documents
Badge, phone, tools; work certificate and last payslip.
What does TEMPO do when an employee leaves?
Leaving date
On that date, the employee loses access to the app and is removed from the time clocks.
Last month’s hours
The period’s activity statement is exported to your payroll software.
Leave balance
The leave register gives the number of days to pay.
Advances and equipment
Outstanding advances and issued equipment are listed to be deducted or recovered.
Work certificate
Issued directly from TEMPO.
See also
The rules that feed into the final settlement.
- Annual leave in Morocco Annual leave in Morocco: 1.5 days a month, i.e. 18 days a year, 1.5 extra days per 5 years of seniority, 30-day cap, carry-over and pay in lieu.
- Seniority bonus Seniority bonus in Morocco: 5%, 10%, 15%, 20% and 25% by years of service (article 350), calculation base, periods counted, worked examples.
- Gross to net in Morocco Gross to net in Morocco in 2026: CNSS, AMO, professional expenses, income tax brackets and family deductions, with two worked examples and sources.
- Leave management Leave management in Morocco: entitlements under the Labour Code, public holidays excluded, approval workflows, leave register and online balance.
Questions fréquentes
How do I calculate the final settlement in Morocco?
Add the last month’s salary prorated up to the leaving date, pay for leave earned and not taken, and severance pay if a CDI is ended by the employer after six months. Subtract any advances and loans still owed. More favourable terms in the contract or collective agreement apply.
How is severance pay calculated in Morocco?
Per year of actual work: 96 hours of salary for the first five years, 144 hours from the 6th to the 10th, 192 hours from the 11th to the 15th and 240 hours beyond (article 53 of the Labour Code). The hourly wage is taken from the average of the last 52 weeks, never below the SMIG. Example: 8 years at 30 DH an hour give 27,360 DH.
Is severance pay subject to IR and CNSS?
It is exempt from IR up to 1,000,000 DH, along with voluntary departure pay and damages (CGI article 57-7°). For CNSS, order n° 1314.25 excludes it up to the same limit when it results from conciliation before the labour inspector, a court ruling or arbitration.
Is untaken leave paid when an employee leaves?
Yes, articles 251 and 252 of the Labour Code provide for pay for leave earned and not taken at the end of the contract: after six months of service, leave for the current year and the two previous years; between one and six months, 1.5 days per full month worked. The pay equals the salary the employee would have received for those days.
Sources
Textes officiels d'où viennent les chiffres de cette page. Les valeurs proposées par le logiciel restent modifiables.
- Moroccan Labour Code (loi n° 65-99), articles 52 to 58 (dismissal), 231, 232, 238 and 249 to 252 (leave), 386 (deductions)
- General Tax Code, 2026 edition (DGI), article 57-7°
- Order n° 1314.25 listing the items excluded from the social security contribution base, points 10 and 11 (Arabic text)
- Decree n° 2.25.983 of 29 December 2025 setting the legal minimum wage (Arabic text)