Once the Employer/Employee relationship ends, Payees should be ceased and notification sent to the ATO.
STEP 1 - Enter the Cessation Date and Reason for the Payee (Employee).
STEP 2 - Lodge an STP Update to notify the ATO of this change.
If the Payee has passed away, the final pay cannot be processed until the Beneficiary Details have been received and entered within the Payee Master File.
Employers must follow their award or enterprise agreement about when final pay must be paid. Most awards require employers to pay employees their final pay within 7 days after their last day of employment. Where the NES requires an entitlement to be paid sooner than under an award or enterprise agreement, the NES must be followed.
If an award or enterprise agreement doesn’t have any rules about when final pay needs to be paid, the Fair Work Act applies. It requires an employer to pay an employee at least monthly. Different rules apply for payment in lieu of notice, where the employee doesn’t work out their notice period. Check your enterprise agreement, award or employment contract for specific rules about final pay.
STEP 3 - Compose the Payees' Pay Details, including all Termination payments required.
STEP 4 - Proceed with the remaining steps per How do I process a Single Touch Payroll Pay Run?