Creating a final pay for a departing employee
When a staff member is ending their period of employment with you, you need to run a final pay for them By doing a final pay, any leave owing (excluding sick leave) gets calculated and the employee gets removed from the active employee list so that they cannot be selected for any future pays. This also sends a message across to IRD that this employee is no longer employed by you. Their profile will be archived for the record and can be accessed any time you wish to access them.
Select the employee for their final pay
Switch on the employee's timesheet as per normal. If other people are scheduled to be paid they can be added also and will not be affected by the terminated employees final pay status, once set.
Set up the timesheet
- Enter the standard hours for this employees last pay period if any.
- Check to confirm if the balance showed in the annual leave liability table is correct for a final payout.
- The 'Annual leave liability' table shows what leave is owed to the employee excluding the sick leave. (no monetary value held to sick leave days on an employee's exit)
- When you are happy that all the leave that will be paid out looks correct, press the red button that says "Make this......final pay" to set the final pay
Check employee's leave liability (for employees using 'Rate set as per the holidays act')
- Check to see how many allocated annual leave days are owing and the value of each day under 'rate:'
- Check the 8% figure here to see what leave has accrued since their last leave anniversary
- If an employee has any 'Alternative leave owing', you will need to add it to the timesheet and pay it out before the 'Final pay' can be set
- This is the total leave liability that will be paid to this employee upon setting the final pay
Pay out any 'Alternative leave days' (days in lieu)
As an example below, Helen needs to have her 'Alternative leave' day paid out. Scroll back up to the timesheet and follow the steps below:
- Add a row
- Set the pay type to 'Alt hol (-)'
- Enter the normal (or average) number of hours that would constitute a days work
- Update and save
- Click back into the 'Alt hol (-)' hour entry (inside the box where the hours are entered) to see the leave information for the amount being paid and the days being deducted.
- Make sure that the system is deducting the correct number of days here so that your alternative leave balance returns to zero
Set final pay
Click on 'Make this [--your employee's name--]'s final pay'
Check the results
- Make sure the final pay has been triggered! You will see 'final pay' in the header.
- To make any amendments, simply click 'undo final pay'. Any amendments to the timesheet will undo the final pay and when you have finished making changes you will need to click on the final pay button again to reset it.
- Finally make sure you can see the leave paid out amount in the summary.
Your done! Now you can return to the dashboard. This employee's pay has been finalised and you will see a 'F' next to their name. After this pay they will no longer be available in the active employee list.