Summary

This topic summarises the termination process for the following 'Original' ETP scenarios.

Termination with no ETPs

The Decide whether a payment is an ETP table shows which employee termination payments are ETPs. If the employee has no ETPs (such as a casual employee):

• Check the employee’s final pay.
• Add a termination transaction in a manual pay.

Termination with ETP

If the employee has ETPs:

• Check the employee’s final pay.
• Add an Employee Terminations record.
• Add a termination transaction in a manual pay.

FAQs

When am I required to process an employee’s final pay on termination of employment?”

It depends...please check the following:

1. Check your relevant industrial instrument (Award, EA, Contract, Workplace Policy etc) for any terms regarding payment of final monies. Some Awards are silent on the matter and other Awards have specific instructions. For example, the Building and Construction Award states:

   “31.4 When notice is given, all monies due to the employee must be paid at the time of termination of employment. Where this is not practicable, the employer will have two working days to send monies due to the employee by registered post (or where paid by EFT the monies are transferred into the employee’s account)”

2. In the absence of any specific instructions, the Fair Work Act states that an employee must be paid at least monthly. Further provisions may apply for employers who are governed under the State/Territory Industrial law and Regulations.
3. As a basic rule of thumb, it is best practice to make the final wage payment on the last day of work or within the pay run that includes that day. Use a bit of common sense though – if you are processing a monthly payroll very early in the month containing an employee who is terminating on the last day of that month (i.e so the monthly pay is almost entirely in advance) may not always be a wise idea to pay the employee a month in advance. They make take leave during that month for which they do not have sufficient entitlements resulting in a overpayment on termination of employment.