Final Pay and related questions
To pay a final pay, do NOT manually enter a termination date before processing the final pay - the termination date is entered automatically by Payroll Pro when the final pay is processed. If you manually enter a termination date before processing the final pay, the employee will be made inactive and you will not be able to enter their final pay. If you have done this and cannot call up the employee under "Enter Current Pay": return to "Add & Edit Employees", call up the employee, remove the termination date, and then click the Active box (just above the Start Date box) to set the employee to "active" again.
You can pay the final holiday pay with your normal pay - you do not have to process a separate payrun to pay out the final holiday pay.
You should enter all hours worked, and any allowances and/or deductions before clicking the final pay box.
Procedure for a final pay
The payrun will be processed as any other payrun - entering time worked, printing payslips, and updating totals. The employee with the final pay can be included in the payrun with the other employees being paid.
For the employee with the final pay:
- Enter any allowances and/or deductions if applicable.
- Click the TimeSheet tab to enter any hours and days worked etc.
- On the same screen (the TimeSheet area) you will be able to set the pay as a final pay (you will see a tick box at the bottom of the window for this), and then enter the final holiday pay amounts.
For an employee on the days or hours method of holiday pay, Payroll Pro will automatically pay out the balance for you, and will verify the value of the balance of holiday pay in the same way it does when an employee takes holiday pay. As per the Holidays Act it will also pay the employee 8% of the gross earned since the employees last anniversary date.
If the employees balance was negative (ie they had taken some days in advance) Payroll Pro will deduct these from the pay so that the employee is paying this back.
- Once the TimeSheet window is closed, the Final Pay box will show a tick and will be highlighted in red.
- Ensure the employee is set to be paid - ie YES showing beside the button "To Be Paid This Payrun".
- If you have forgotten to enter some hours for the employee or another part of the employees pay, do the following: Click "Final Pay" again to remove the tick, make changes to the hours worked, then click "Final Pay" again - you will be asked to verify the holiday pay amounts again if the employee is on the days/hours method of holiday pay.
- When the totals are updated for this pay run, the employee will automatically be made non-active and a termination date will automatically be entered for the employee.
Payroll Pro is flexible - you can override figures if you need to for some reason.
Paying an employee separately for their final pay
As mentioned above, you can pay an employee their final pay in a normal pay run at the end of the pay period.
If however you need to pay the employee separately - for example they are leaving a few days before the end of the pay run and you want to pay them on that day - you can process a payrun just for them. This is just a matter of going into the "Change Date" option and entering the date. Then go to "Enter Current Pay", enter hours, allowances, etc and set to final pay as in the instructions above.
Set the employee to be paid, then print their payslip and update the totals.
You will see a "One Off Pay" option in "Enter Current Pay" - you do NOT need to use that option in this case - this is really for use for a current employee who is receiving some extra pay between pay periods and which doesn't relate to time worked.
Employee on Salary
If you do need to adjust the employees salary amount for the final pay for any reason - for example employee is leaving part way through the pay period, you can just manually alter the "salary this pay" in the white box to the top left of the time sheet window. You do not need to use the "Calculator" button beside the adjustments box, just directly enter the salary for this pay into the white box. If you do this, you will see the adjustment's box automatically show the difference between the "Usual Salary" and the "Salary This Pay" you have entered.
Final Pay for a Casual Employee or Employee on % of Gross Only
1. Pay As You Go Holiday Pay
For an employee paid "Pay-As-You-Go" holiday pay, the final holiday pay amount will just be 8% of any of the final hours being paid, as for any other pay run for the employee. You should still click "Final Pay" after entering in hours. The tax will be calculated using a flat rate as per IRD rules.
2. Percent Of Gross Holiday Pay but not on a pay as you go basis
If an employee on a percentage of gross holiday pay calculation has NOT been paid on a "Pay-As-You-Go" basis, then clicking "Final Pay" will pay out all the remaining holiday pay balance. The tax will be calculated using a flat rate as per IRD rules.