Whenever an employee leaves an organization, it's essential to settle their payments and deductions to avoid pending dues from either side. The Full and Final Settlement (F&F) in Keka helps streamline this process by breaking the whole process down into five simple steps.
TABLE OF CONTENTS
- Step 1: Exit Notice
- Step 2: Pending Activities
- Step 3: Payables
- Step 4: Dues & Overrides
- Step 5: Finalize
So, let's take an example of an employee who has submitted their resignation and see how their F&F settlement process works.
Start by going to the Org section and open the Exits. The In Exit Process section here contains the list of all the employees who have resigned or been terminated by the company.
To start the settlement process for an employee, open the menu under the Actions column and select Process and Settle.
Now, let's get into the five steps of the process.
Step 1: Exit Notice
In this step, you can check and edit the Exit Details for the employee, which comprises of the reason why an employee is leaving and details about their notice period. Here, you can also decide whether this employee is eligible for rehiring.
Then, you can decide what will happen with the remaining leave balances of the employees. The 'Availability' criteria are decided while configuring the leave type initially. Here, you can decide if the notice period will be extended if the employee applies for that leave.
At the bottom of this section, you can also leave any comments that are necessary. Then click the Save & Continue button to proceed to the next step.
Step 2: Pending Activities
In this step, you can take action on the Exit Tasks assigned to the employee. You can update their status, add comments, delete or add new tasks, or even new task lists. You can also make it mandatory for the employee to submit the exit survey form.
Now, this particular employee does not have anyone reporting to them, But if they did, we would have to assign their reportees' new reporting manager from the Transition reporting employees section.
Then, below this, you can update the Asset's status assigned to the employee, indicating if it's recovered and its current condition compared to the initial assignment.
Step 3: Payables
This is the step where you can check what Payables the employee is entitled to as part of the F&F settlement.
You can check and edit the amount for payables like Gratuity, LOP Reversals, Bonuses Due, Overtime, Shift Allowances, etc. You can also choose to make these tax exempted if applicable.
You can also configure their Leave Encashment settings in this section. You have the option to choose an Encashment policy or override the calculation generated by the system. Additionally, you can decide to either pay or void the amount by selecting the appropriate option from the Pay Action drop-down menu.
Finally, there's the option to add an adhoc payment type for any one-time payment that you wish to pay to the employee. Moreover, you can choose to pay any other settlement amount while processing the Full and Final(F&F) settlement. Once you have made the necessary changes, click on Save & Continue to proceed to the next step.
Step 4: Dues & Overrides
You can use the Dues & Overrides step to keep track of any outstanding payments an employee owes to the company. This allows you to make necessary adjustments and overrides.
For example, if an employee does not need to serve the complete designated notice period, you can adjust the Notice Period Buyout settings accordingly. You can also make LOP Overrides if necessary. Furthermore, under Loans, you can check for any pending loan amounts that need to be settled in the current month.
You also have the option to override the contribution amounts for ESI, LWF, PT, and Income Tax, you can use the Contribution Override feature.
Additionally, you can deduct any ad hoc deductions from the total payable salary of the employees adding the One-time Deductions. You will have to select a preconfigured deduction type and the amount.
Once you have made the necessary changes, don't forget to click on the Save & Continue button to save the overrides.
Step 5: Finalize
During the Finalize step, you have the choice between opting for a One-time Complete Settlement or a Periodic Partial Settlement. You can switch between these options by clicking on the Change Settlement Mode button.
If you opt for a One-time Complete Settlement, you have the option to review the settlement amount and download the comprehensive calculation summary by clicking on the Download F&F Statement (1) button.
you can choose what to do with the settlement status (2) from the dropdown, you can either Pay it, Void it or mark it as Already Paid. If you decide to pay, you will need to select the Settlement Month(3) and then click on the Finalise and Settle(4) which will cause a prompt to appear where you will need to click on Confirm to complete the process.
If you opt for a Periodic Partial Settlement, You will have the option to settle payables/deductions across multiple months.
To do that click on Manage against the respective section.
and then can choose a settlement status(1), either Pay it, Void it or mark it as Already Paid. If you decide to pay, you will need to select the Settlement Month(2) and then click on save(3).
you can also download the comprehensive calculation summary by clicking on the Download F&F Statement(4) button.
after reviewing the details, click on the Finalise and Settle(5) which will cause a prompt to appear where you will need to click on Confirm to complete the process.
That concludes the Full and Final Settlement (F&F) process in Keka. With these five simple steps, you can ensure a hassle-free and efficient exit process for your employees. And if you ever need to make any changes after this, you can come back here and update it or even change the settlement month.