Termination (NZ)

Form ID: (MPPP5400)

The Termination screen is opened from the Employee's Current Pay (MPPP3130) screen. It allows you to calculate termination payment amounts for an employee whose contract is being terminated in the pay. Once you have entered all details on this form, click Save & Close to close the form and add the appropriate pay items to the employee's current pay.

You can re-open the Termination form to edit the termination details—clicking Save & Close re-generates the termination pay items in the employee's pay. Alternatively, you can click the Delete icon to remove all termination pay items from the employee's pay.

Summary Area

In this area, you can specify the basic details for a new termination.

Element Description
Batch number The ID number of the batch that will contain journals relating to the termination.
Pay run ID The ID of the pay run that the termination occurs in.
Employee The ID number of the employee being terminated.
Employee name The name of the employee being terminated.
Created date The date when the termination record was created.
Created by The name of the user who created the termination record.
Last modified date The date when the termination record was most recently modified.
Last modified by The name of the user who most recently modified the termination record.

Details Tab

This tab displays general information about the termination.

Table 1. Termination Details
Element Description
Reason Select the reason for the termination - this is used for record-keeping and reporting purposes only. The following options are available:
  • Resigned
  • Retired
  • Redundancy
  • Constructive Dismissal
  • Dismissal
  • Abandonment
  • Other
Last day of employment The date when the employee's employment ends. Entitlement accruals cease at this date.
Notional end date This date is calculated automatically, according to the employee's last day of work, their unused earned Annual Leave balance, and any eligible public holidays falling within this period. (Any public holidays falling during this period are paid out on termination.)

Unused Annual Leave Tab

This tab provides an overview of the outstanding earned and accrued Annual Leave to be paid out to the employee. It describes the relevant rates that apply to each, and allows you to change or override the rate that may apply. For Earned (entitled) payments, the solution sets the default pay item by comparing the Average Weekly Earnings (AWE) rate against the default Ordinary Weekly Pay (OWP) rate method set for the employee. You have can use the rate method set by default by the system, apply any of the rates presented or provide a custom rate.

Table 2. Earned (entitled) payments
Element Description
Earned (entitled) payments
Select the rate method to use for earned Annual Leave payments. The default method set by the system will be selected initially. Choose from:
  • AWE Rate: The Average Weekly Earnings rate as calculated by the system and made available for rate comparison.
  • OWP standard rate: The Ordinary Weekly Pay standard rate as calculated by the system and made available for rate comparison.
  • OWP 4 week average rate: The Ordinary Weekly Pay 4-week average rate as calculated by the system and made available for rate comparison.
  • OWP special agreed rate The Ordinary Weekly Pay special agreed rate as calculated by the system and made available for rate comparison.
  • Standard rate: The Standard rate as calculated by the system and made available for rate comparison.
  • Custom rate: Allows you to enter a custom rate to be used when calculating the earned payment value.
Comments Enter any comments relating to the choice of rate, e.g. when "Custom rate" is selected, you can enter the reason for choosing a custom rate. This field is required if you select a different rate method from the system default.
Remaining "earned" units The remaining "earned" Annual Leave to be paid out to the employee.
Earned payment The value of the earned leave payment, i.e. the rate times the remaining earned units.
Table 3. Accrual payment
Element Description
AL YTD gross earnings The sum of pay items flagged as "Liable for Holiday Pay" that the employee has received since their last leave rollover event up until the end of their last pay period.
AL Current pay gross earnings The employee's gross earnings flagged as "Liable for Holiday Pay" within the pay currently being processed. This includes the value of termination payments such as Public Holiday and "Other Leave".
Total gross earnings (Liable for HP) The sum of AL YTD gross earnings and AL Current pay gross earnings.
% of Gross earnings The percentage of gross earnings component in an employee's final pay. The percentage used is derived from the Entitlement record associated with the termination payment.
Less total paid in advance The % of Gross earnings amount, less any Annual Leave taken in advance.
Custom Amount This field lets you enter a custom amount to be used when calculating the accrued payment value, overriding the amount calculated by the system.
Comments If you entered a custom amount, use this field to enter the reason for doing so.
Remaining Accrued Units The remaining accrued Annual Leave to be paid out to the employee.
Accrual Payment The value of the accrued leave payment, i.e. the rate times the remaining accrued units.

Public Holiday Tab

This tab provides an overview of the public holidays that affect the termination payment. You can add public holidays that weren't added automatically, as well as remove any public holidays that shouldn't be included in the termination payment. If an employee's rate method uses the standard rate, you also need to add scheduled hours.

Public holidays affect termination if all of the following conditions apply:
  • the holiday falls after the employee's employment ends.
  • the holiday falls on an Ordinary Working Day for the employee.
  • the employee has some remaining earned Annual Leave balance.

Each entry is rated according to the employee's preferred FBAPS rate method as defined on the Pay Details (MPPP2310) screen.

Element Description
Pay Item ID The unique code of the pay item used to pay out the public holiday.
Date The date on which the public holiday falls (original/observed).
Public Holiday A description of the public holiday.
Scheduled Hours The hours the employee was scheduled to work on the day, which is used to determine the RDP rate if the employee is set to use the "RDP - Standard Rate" rate.
Quantity The quantity to be paid, in days.
Unit The unit of the associated pay item, which should be "Days".
Rate Method The rate method used to value the payment, as set on the Pay Details (MPPP2310) screen for the employee.
Rate The rate calculated by the system applicable to the day on which the public holiday falls.
Override Tick the box in this column to enable the Override Rate column.
Override Rate If enabled, allows you to enter a custom rate to be used when calculating the public holiday payment value.
Comment If you entered a custom rate, use this column to enter the reason for doing so.

Unused Other Leave Tab

This tab provides an overview of any other leave to be paid out and can, depending on employment agreements, include pay items for sick, alternative, long service leave etc. Each item is rated according to the valuation method set on the relevant entitlement.

Element Description
Pay Item ID The unique code of the pay item used to pay out the leave.
Pay Item Description The name of the pay item providing an indication of the leave being paid out.
Payslip Label The description of the pay item on the employee's payslip.
Entitlement Balance The outstanding entitlement balance to be paid out.
Unit The unit of the associated pay item.
Rate Method The rate method used to value the payment derived from the entitlement's valuation settings.
Rate The rate calculated by the system. Where the FBAPS rate method is used, the daily rate of the last day of employment is used.
Override Tick the box in this column to enable the Override Rate column.
Override Rate If enabled, allows you to enter a custom rate to be used when calculating the payment value.
Calculated Amount The final amount calculated using the rate and the outstanding entitlement balance.
Comment If you entered a custom rate, use this column to enter the reason for doing so.