Here I am again to address now one of the central topics that can affect many employees who unfortunately found themselves to be fired, today we will see what happens with the fifth salary in the event of dismissal .
I repeat that “transfer of the fifth salary” means that particular form of loan that the employee, private or public, can request without having to provide any specific justification regarding the request.
The particularity of this loan is that it is reimbursed by the monthly salary deduction of (up to) one fifth of the salary.
That said, the point I would like to focus on this time is what can happen to an assignment of the fifth in progress in the hypothesis in which you are fired .
Cession of the fifth and dismissal: What happens?
The severance pay, or “severance pay”, is the sum of money that is paid in the event of termination of the employment relationship.
The employer is obliged to pay this sum, whatever the reason for termination of the relationship.
But why do I talk about the severance pay? Simply because, as I have underlined in another article , between tfr and assignment of the fifth there is in fact a connection.
Generally, in the hypothesis in which a transfer of the fifth is in progress, the severance indemnity is blocked or tied to the same assignment and this as long as the loan lasts.
In other words, in this situation the severance pay is blocked as a guarantee for the financial institution. Added to this is the obligation to take out an insurance policy to cover the loan in the event of insolvency.
In the event of dismissal, it will then be used to settle all or part of the residual debt.
It is possible that two cases occur at the time of dismissal, in which your tfr can be:
A) Less than the residual debt
B) Greater than the residual debt
In the first hypothesis, you will remain in the debtor position (against the financial). You will then be required to extinguish the excess part by means of a normal bank transfer.
In the event that the severance pay is higher than the residual debt the company will pay your severance pay to the financial institution for the amount corresponding to the debt, the remainder of the TFR will give it to you.
Is all about the financial?
This is one of the questions most often asked by many workers in the event of dismissal.
I have already said that the severance pay is “blocked” as a guarantee for the budget. This means that the latter can ask the employer for the payment of the tfr …. just right … but fortunately can not do it “indefinitely just because it goes”. In fact, it can proceed as long as the amount of the remaining debt has not been fully covered.
It is also right to underline that the employer is not obliged to provide severance pay, unless it is expressly provided for in the loan agreement.
Do not forget then that, often and willingly, in this same contract is stipulated the stipulation of an insurance policy that serves as a cover in case the subject loses the job. This means that your severance pay would not be touched.
So the answer to the question above comes from itself.
Assignment of the fifth and dismissal of the just cause: what happens?
There are different causes of dismissal, such as the bankruptcy of the company: in this case, it will be the employment risk policy (where stipulated) to cover the remaining portion of debt.
But I want to highlight the case in which the employee is dismissed from the company for a just cause: in this case, the insurance company can refuse to repay what remains of the debt to the bank. This creates an insolvency and the credit is put into banking distress and in the hands of the worker.
Transfer of the fifth and new employer
In the event of dismissal, the employment relationship formally comes to an end and this also involves the interruption of the obligation that the “former company” had towards the financial company.
The latter retains the right to refer to the accumulated severance pay and to request the dismissed employee to repay the uncovered portion.
In case the worker has found a new job, he will have to send a registered letter to the financial institution, giving notice of the new employment and requesting that the remaining debt can be withheld from the salary paid by the new company. Naturally, it remains at the discretion of the insurance company to accept or not risk coverage with the new employer. It happens in fact that the new company is not “assumable” by insurance companies, in this the payment in a single solution remains in the hands of the worker.
Drawing conclusions, always make sure how much debt is (this can be accurately known by asking the financial company for an extinction count ) and also checks the amount of your severance pay.
Did you lose your job and have you had any hiccups about a fifth sale in progress and your severance pay?
I hope this article has given you some extra tools to avoid being left in such a delicate situation.
Also leave a comment of your experience below.
In concluding this topic, I wanted to inform you that if you have renegotiated a salary or pension assignment in the past few years, you most likely have to return part of the interest paid. Inform yourself by following this link: Repayments of the assignment of the fifth