header

Creating a Termination Package

Owned by Philip Sullivan (Unlicensed)
Last updated: Oct 14, 2022
4 min read

Termination packages can only be applied to a main pay run where the termination date is within the pay period.

Steps on how to open the termination wizard can be found in the Opening the Termination Wizard article.

Only one employee can be selected per termination package.

Termination Reason

  • Not mandatory.

  • Completed if you want to report on predefined termination reasons through the report builder, e.g., Transfer to NZ.

  • Reasons can be customised through Company → Company Options → Configure Company Reasons.

STP Termination Reason

  • Mandatory.

  • Required by the ATO for reporting through STP Phase 2.

Termination Payment Type

  • Mandatory.

  • Normal Termination - Treats as normal termination.

  • Genuine Redundancy - Includes the redundancy payment in the Other Payments step and changes how the long service leave tax periods are taxed.

Leave balance includes accrual calculated until the termination date if the employee is on standard accrual and has a work pattern setup.

If the employee is on proportional accrual, then the system won’t calculate any additional balance as there is no method to base the calculation on. The leave balance will be as at the latest closed pay period.

Leave loading is only included in the calculation if setup to automatically pay with the annual leave components instead of it being defined as its own component, e.g., when leave is taken there are separate components for annual leave and leave loading.

Tax Periods

Depending on the termination type, the tax periods leave balances have been loaded into will be taxed differently.

Tax Period

Genuine Redundancy

Normal Termination

Tax Period

Genuine Redundancy

Normal Termination

Pre-16 August 1978

Lump Sum B

Lump Sum B

16 August 1978 to 17 August 1993

Lump Sum A

Lump Sum A

Post-17 August 1993

Lump Sum A

Gross Payments

Leave balance includes accrual calculated until the termination date if the employee is on standard accrual. Work pattern is required if balance is held in hours.

If the employee is on proportional accrual, then the system won’t calculate any additional balance as there is no method to base the calculation on. The leave balance will be as at the latest closed pay period.

Redundancy Payment

This is only automatically included if the termination type is Genuine Redundancy.

Relevant Start Date refers to the field Employment Start Date found in Employee → More Details. If a value doesn’t exist, then the Start Date will be used. The purpose of using an earlier date is to reflect continuous service as it applies to redundancy.

Termination Notice

If an employee or employer has not given sufficient notice, untick Sufficient notice was given by the termination party and the wizard will calculate the notice period entitlement for the employee.

Additional Unused Leave

Only required if other leave types are to be paid on termination.

 

New Payment

Any other payments that need to be included can be added into the New Payment section.

Multiple additional payments can be added if necessary.

 

footer