Back payments after resignation

It often happens, especially with resignations, that another pay process is necessary after the regular pay process (e.g., with the monthly wage and the portion of the 13th Payday) so that overtime and other entitlements can be remunerated after the actual resignation.

When considering additional payments after resignation, the decisive factor is whether the entitlement to this additional payment already existed at resignation or not.

For example, the entitlements below are already known at the time of resignation:

- holiday entitlement

- overtime

- sales commission

If the entitlement is already known at resignation, the payments after resignation must be fully arranged for in the month of resignation. This means that the wage subject to income tax and the income tax rate determination are added from both pay processes. The calculation is made as if the first pay process had been canceled and everything was billed together in the second pay process. In this case you do not need to change anything in the Personnel card. Include the wage values to be settled in the Report journal.

For example, the entitlements below are not yet known at the time of resignation:

- bonus

- retroactively defied premium

If the entitlement is not yet known at resignation, the value of the month of resignation is added to calculate the rate-determining wage, not the wage subject to income tax though. This means that the first payslip is no longer adjusted. Only the new amount (i.e. bonus or retroactively defied premium), and not the original wage in the month of resignation, is raised for the second payslip with the wage payment after resignation. In this case, you must activate the ‘Tax at Source additional payment after resignation without recalculation’ field in the ‘Tax at Source’ tab of the Employee card of the person concerned.