SmoothPay includes a termination function that calculates outstanding leave and prepares the employee’s final pay. The employee is then marked to terminate on completion of the current pay process.
Prior to Termination
Before using the termination function, you should always prepare any normal pay entries first.
This is important because:
Normal payments such as ordinary time, allowances or other earnings can affect termination calculations, as some rules rely on these amounts as part of the calculation
Processing a termination before entering normal pay may result in incorrect values being applied
Always enter any regular pay items first, then use the Terminate button once all non-termination items are complete.
Using the Termination Function
Go to the Payrun screen
Select the employee
Click the Terminate button
Review the termination calculation
Make any required adjustments
Complete the pay process to finalise the termination
Once processed:
The employee no longer appears in the current staff list
All historical data remains available
Reports can still be run on the employee
What the Termination Calculation Includes
The exact calculation varies by jurisdiction and may require manual intervention where rules are ambiguous. Generally, the termination calculation includes all entitlements that are legally required to be paid out.
SmoothPay automatically applies the correct rules based on your jurisdiction and the leave code classifications.
Leave Payments on Termination
The treatment of each leave type depends on local legislation, company policy and the employee’s employment agreement.
Common outcomes include:
Annual leave
Usually paid out in full
Valued according to the jurisdiction’s rules
Sick leave
Usually forfeited
Can be manually applied prior to calculation
Long service leave
Paid out depending on jurisdiction and qualifying service rules
SmoothPay supports regions where LSL rules apply
TOIL/RDO
Normally paid out
Valued at the employee’s current rate unless configured otherwise
Always check jurisdictional requirements if you are unsure.
Final Pay Components
Final pay may consist of:
Pay for hours worked up to the termination date
Payment in lieu of notice (if applicable)
Annual leave payout
Long service leave payout (if applicable)
TOIL/RDO payout
Any additional contractual or statutory termination payments
SmoothPay will display each component separately so you can review before approving.
Post-Termination
After the termination pay is processed:
The employee is marked as terminated
They cannot be selected for future pay runs
All historical data remains accessible
Their records continue to appear in reports where relevant
Leave history and payslips remain intact for auditing and compliance