Payroll processing for terminated hourly and salaried employees

7shifts Payroll handles salary, benefits, and post-tax deductions differently for terminated employees depending on whether the employee profile is set to salaried or hourly.

Things to know

• A termination date must be entered for an employee for 7shifts Payroll to calculate automated prorated amounts.
• Terminated Salary employees are automatically removed from draft payrolls to prevent incorrect automatic deductions.
• Terminated Hourly employees remain in draft payrolls if they have recorded labor data for the pay period.

Salaried employees

When a salaried employee is terminated, 7shifts removes the employee from all draft payrolls to prevent automatic benefits or post-tax deductions.

To process a final payment for a salaried employee, you must use an off-cycle payroll. In the off-cycle payroll, the salary amount becomes an editable field.

• If a termination date exists, 7shifts Payroll calculates the amount owed based on that specific date.
• If no termination date exists, 7shifts Payroll assumes the employee worked the full pay period.
• You can manually edit the calculated value in the off-cycle payroll to make final adjustments.

Hourly employees

When an hourly employee is terminated, their recorded labor data remains available for processing. 7shifts Payroll continues to apply benefits and post-tax deductions based on the employee's total earnings.

• Terminated hourly employees are included automatically when you process a regular payroll run.
• You can run an off-cycle payroll to process a final payout sooner if the employee requires payment before the regular pay period ends.

Next steps

Final payments can be issued by following the steps in Run an Off-Cycle Payroll.