Final Settlements

What End-of-Service Settlement meaning?

This is a document or process that confirms the settlement of all an employee's financial entitlements and other rights with the company upon the termination of the employment relationship (whether due to resignation, termination, retirement, or contract expiry).

If your organization's policy requires reviewing and approving an employee's attendance record, and thus applying attendance deductions to the employee's final settlement, you must activate this option by going to the Settings page > Payroll > Settlements > Final Settlement > selecting the pay group > Confirm attendance record required for final settlement > then clicking the Activate button.

This will make verifying the terminated employee's attendance record and reflecting the deductions in the settlement a mandatory step before the final settlement is approved.

End-of-Service Benefit Calculation Basis:

This section specifies the basic salary component upon which the end-of-service is calculated. The current option is "Basic Salary," meaning that the gratuity is based solely on this salary. The user can create a specific formula to calculate the leave balance, depending on their preference.

Leave Balance Calculation Basis:

This section specifies how the value of accrued leave balance is calculated. The current option is "Custom Formula," which is based on adding "Basic Salary + Housing Allowance + Transportation Allowance" and other customizable components, and adding operators.