Payroll · Daily operations · 11 min read

Pay a leaver with a final settlement

Turn an HR termination into a calculated, reviewed, approved and paid final settlement.

Before you begin

• HR has completed the employee's termination with the last day and reason, and marked any loan or asset to recover from final pay.
• An approved settlement policy covers the reason on the last day (see Settlement policies).
• The Final settlements feature is on.
• Four different people take part: the preparer, a specialist reviewer, an approver, and the person who raises payment. Finance posts and releases.

Steps

Create and calculate

1. Go to Payroll > Final settlements and click Check for terminations. HR events are also collected automatically within a minute or so. There is exactly one settlement (PST-...) per termination.
2. Open the settlement and click Calculate.
3. Review the Components tab (unpaid salary, leave settlement, end of service, notice pay), Deductions and recoveries, the findings, and service length and leave units.

Review

1. The preparer clicks Send for review. It must have no blocking finding.
2. The specialist opens it and enters a written note for each component shown as Not configured - specialist rule required (at least 5 characters), then clicks Sign off specialist review.
3. If the specialist disagrees, click Return to preparer with a reason of 5 to 500 characters.

Approve, post, pay

1. An approver (not the preparer, not the specialist) clicks Approve. A final run with one payslip is created.
2. Finance clicks Post.
3. A fourth person with payroll.pay_prepare clicks Raise payment, then prepares the payment file. Finance releases it. See Payment instructions, bank files and WPS.
4. When the bank accepts, the settlement is Paid. Click Close.

You can print a bilingual statement with Print statement.

What happens next

Worked example, DEMO policy values: leaver L, BASIC 10,000, HOUSING 4,000, TRANSPORT 1,000, last day 15 October.

• Unpaid salary for 1 to 15 October by proration: 15 / 31 x 15,000 = 7,258.06.
• Leave settlement, 10 days due: 10 x 0.5 x (15,000 / 30) = 2,500.00.
• End of service, DEMO rule, 3 completed years: 3 x 3 x (10,000 / 30) = 3,000.00.

These multipliers are placeholders. With the UAE gratuity reading, 7 years 6 months (2,738 days) at BASIC 10,000 gives 5 x 21 + 2.5014 x 30 = 180.04 days, and 180.04 x 10,000 / 30 = AED 60,013.70. Under a year pays nothing, and the amount never exceeds two years' wage.

• Recoveries are netted in the policy's priority order within the cap. A loan of 3,000 with 1,000 repaid and an asset of 1,500 take 2,000 and 1,500 if within the cap. Anything above the cap is shown as Unrecovered, to pursue outside payroll.
• The settlement period is then excluded from the regular run: 'Period 2026-10 is already paid by the final settlement PST-... (...); paying it here as well would pay the same days twice.'

Good to know

• Holds. An HR dispute hold blocks approval, payment and file preparation, and a banner says 'Approval and payment are blocked until every hold is released in HR.'
• Segregation: 'A settlement is reviewed by a specialist other than the person who prepared or sent it.' Approver and payer are likewise different people; the Separation of duties box shows who may act.
• Specialist note missing: 'Every not-configured component needs the specialist's written decision before sign-off.'
• Cancel (with a reason) works before approval. Reopen returns a cancelled settlement to Draft, except 'A settlement that reached a run cannot be reopened.'
• Correct settlement works only within the policy's correction period: 'The policy accepts corrections for 30 days after posting; this was posted 40 days ago.'
• Only the mechanism is built; every statutory rate must be confirmed by your specialist.