When an employee leaves, you record the separation, work through the offboarding checklist, prepare the final pay and give the certificate of employment. This guide takes you through each step.
Record the separation
- Open Employees, choose the employee and find the Status card.
- Set Status to Separated.
- Enter the Separation date: the employee's last day of work.
- Choose the Reason, for example resignation, end of contract or project, redundancy, retirement or death, and add Details if useful. The reason sets the alphalist code and the separation pay Sahora suggests.
- Click Update. You see "Status updated."
For an employee on leave or suspended who is coming back, choose Inactive (on leave, suspended) instead.
What happens next:
- On the separation date, the employee's portal login and any other role they have in your company (except Owner) are switched off. A future date is handled overnight when it arrives.
- If your company holds the pay of separating employees, their last cut-offs are held until the final pay (see Holding a salary).
The offboarding checklist
A Separation section appears on the employee's page with the Offboarding card and a progress bar. Its items:
- Clearance signed
- Loans and accountabilities settled
- Final pay computed and paid
- Certificate of employment given
- BIR Form 2316 issued
- Portal access switched off
Sahora ticks some items itself, such as the final pay once its payroll is approved. For the others, add a note if you like and click Mark done (or Untick).
Prepare the final pay
Final pay is due within 30 days of the separation date. Owners and payroll officers prepare it.
- On the Status card, click Final pay.
- Check Computed from the records: the 13th month pay to the separation date, unused leave in cash, loan balances, and the tax annualized on the final payslip.
- Under Separation pay and other items, choose the Payroll period that pays the final pay and the Reason for leaving. Sahora suggests the separation pay or retirement pay for the reason and the years of service; change it if your policy or agreement gives more.
- Add other earnings with + Another earning (tick Taxable where it applies) and clearance deductions with + Another deduction.
- Leave the box ticked to deduct the whole remaining balance of loans and advances, or untick it.
- Click Save, then Prepare final pay.
- Compute (or recompute) the payroll for that period. It carries the final pay. Submit and approve it as usual.
To change something before that payroll is approved, click Undo (back to draft).
Under Payroll and documents you then find the Final pay computation sheet (PDF) and the Payslip (PDF). Once the payroll is approved, you also get the Release, waiver and quitclaim (PDF) and the employee's BIR Form 2316 for the year.
If the final pay doesn't cover what the employee owes, a Receivable from the employee card lists the rest to collect outside payroll.
Sahora's suggestion follows the Labor Code and the retirement pay law for the reason you choose. Whether a reason applies, and whether your company owes more under its own policy or a collective agreement, is a labor question. Have the amounts and the quitclaim reviewed before the employee signs.
Held salaries
If pays were held, the final pay page lists them. Once the final pay's payroll is approved, Finance or the owner releases them on Payroll → Held salaries.
The certificate of employment
At the top of the employee's page, next to Certificate of employment, choose without pay or with compensation. The certificate is signed by the signatory in your BIR details. Give it within 3 days of the employee's request.
Employees can also ask for one from the portal. Requests and final pay deadlines are listed in the Final pay and COE tracker report on the Reports page (see The Reports page).