Process a normal termination

https://help.xero.com/au/Payroll-Employees-EndEmployment-AU

When an employee leaves, set their termination date and then pay them their final pay including any unused leave.

Before you start

Process a normal termination in the final pay

Only gross wages and lump sum items can be included in the final pay. Pay ETP's and complete a payment summary manually.

Before processing a normal termination, make sure you:

• • Approve any pending leave requests dated before the employee's termination date.

  • Delete any leave requests dated after the employee's termination date.

  • Check that the employee's paid leave entitlements will be paid out on termination.

  • Set unused leave as paid on termination

• 1. Go to Payroll, then click Pay Runs.

  2. Select the relevant draft pay run.

  3. Click the employee's name.

  4. Click Set as Final Pay at the bottom of the payslip.

  5. Select the last day of their employment as the termination date, and click OK.

     1. Termination date must be before the end of the current pay period.

  6. Select Normal Termination.

  7. Select the last full pay period with the employee's normal gross earnings, or manually enter the average earnings amount if the employee works irregular hours.

  8. Click Save.

  9. Review the employee's payslip, including:

• • • outstanding wages for hours worked.

    • accumulated leave for the final pay adjustment.

    • tax on unused leave included in final pay

    • Tax table for unused leave payments on termination of employment (ATO Website)

• 10. Process the pay run.

When the pay run is posted, the termination date automatically applies to the employee.