The reality of any company is that all employees will terminate at some stage of their employment whether it be due to resignation, retirement, retrenchment, dismissal or death.  The offboarding process is just as important as correctly onboarding an employee.  A well organised and communicated process will ensure the employee has had a good experience, thereby improving your brand. Offboarding communication is critical in the larger organisation as there may be more steps in the process than in the smaller companies. There have been instances of miss-communication where employees who have left have continued to be paid salaries for quite a few months after termination.  To minimise risks it is vital to have a comprehensive checklist in place which is signed off by various parties throughout the process.

Below is an example of a certain items on a checklist which can be changed to suit any environment.

  • Equipment/stationery – ensure that all equipment (Laptops, business cards, cars, bags, screens, phones, WIFI Routers, clothing, etc.) have been checked and are in a good condition on being informed of the pending termination. If the staff member was onboarded with equipment, the serial numbers etc. must be checked against offboarding equipment.  Any missing or damaged equipment should be discussed and an agreement of a deduction/replacement/write-off must be reached in writing.  Payroll to be informed of any deductions and accounts department to be informed of any write-off of equipment for the asset registers. Service providers need to be informed of changes or discontinuation. Any equipment given to the employee (e.g. laptop) must be accompanied by a letter transferring ownership.
  • IT Support – HR to inform the responsible IT person/service provider of the impending termination. A date should be scheduled to remove company access, software or information with the employee and the responsible person to sign off and confirm once done with the manager/HR. Documents and information stored on the laptop must be transferred or saved should it be required in the future. An out of office email for the terminating staff member must be set up referring them to HR or their manager for at least 2 months. The terminating user’s emails should be forwarded to their Manager or HR in the event that a client or important information is being sent to that email account. Once the out of office etc. has been managed and the employee has left, the email account should be disabled. The employee is to be taken off all relevant internal or external distribution lists.
  • Access to banking or e-profiles – employees in the position of accounting or senior positions may be required to relinquish their profiles before the actual termination date or hand over the profiles to another employee. Should this not be done efficiently, there is a huge risk of fraud.  The sooner these types of profiles are handed over, the better for all concerned.
  • Internal processes – internal extensions need to be removed or re-allocated. Access tags, client access needs to be removed from systems once the employee has left or access changed during their termination period.
  • Payroll – Payroll is the last sign off but the most important one. If the process is not completed correctly, the company could be liable for unnecessary losses.
    • UIF – UI19 forms to be completed for all terminations except on resignation.
    • Medical Aid – HR to assist with the termination for the employee on the medical aid should this be a contribution handled through the company. HR to inform payroll to deduct final amounts (medical aids are normally paid in arrears i.e. October cover gets deducted with the October salary.) Check if there are any gap covers linked and terminate.
    • Leave reconciliation – HR/Payroll to ensure leave has been reconciled and any annual, unpaid, sick leave put through the system and signed off at payroll before the employee is paid out.
    • Expenses – HR/payroll to do a final reconciliation on any expenses or travel to be paid out.
    • Loans – HR/Payroll to ensure that a check is done on any loans outstanding. Should loans be greater than the legislated payment, an agreement must be signed for the employee to refund the company with suitable terms.
    • Provident/Pension/Funeral/RA/GLA/PHI Funds – Any funds paid for or administered by the company must go through a termination or handover process. The relevant supplier needs to be informed of the termination and HR to assist with forms e.g. withdrawal, death, etc.
    • Certificate of Service – the terminating employee must be issued with a certificate of service stating start date, end date, job title, etc.
  • Work in progress (WIP) – Managers need to decide what the employee needs to complete before termination. A meeting to discuss is crucial early on in the termination period.
  • Replacement – Once an employee has sent in their termination notice, HR is to discuss with the Managers of that unit if a replacement is required or other staff members will fill the gap or the position will become redundant. Various scenarios require their own processes e.g. transferring of work to another employee requires consultation, etc.
  • Subordinates – Should the employee have subordinates, they are to be informed and given a new manager to report to asap. This will transfer ownership before the termination date and ensure the process is seamless.  It will also free up time for the terminating employee to finalise their projects without staff management where possible.
  • Exit interview – it is preferable to hold an exit interview with the terminating employee. They will have insight into what was working and what was not working in their position.  It will also give management a chance to discuss why the person is leaving and if there is anything that can be done to salvage the relationship if required.

 

The employee’s final day should be seamless where all administrative tasks have been completed and handed over. There is nothing worse than having to complete huge projects until late night and move onto a new position the next morning. If the employee was valued, a thank you from Management would be preferable.  There is no worse situation than an employee walking away feeling that they were not valued or worthy of a token of appreciation.  You never know if they will be moving on in life and may be your next big client…

 

Reasons why Outsourcing your payroll is the Smart Choice

For many businesses salaries and wages are one of the biggest overheads. Managing this non core aspect of the business can be time consuming and complicated.  If salaries and wages are not processed on time, it can negatively impact staff morale and create the impression that the company is not financially stable. Staying on top of your payroll obligation to employees and SARS can be a headache.  This is why more and more businesses are choosing to outsource their payroll processing to professional payroll administrators.

 

For professional payroll services contact:

George Guirguis
Director

payroll@trupay.co.za

T +27 10 599 0224