Ending an Employee’s Service
Terminations can be performed at any point in your payroll processing cycle. For example, if someone will only be terminated in the next period, you can already set their termination date in the current period. The system will then keep creating payslips for the employee until the termination date is reached.
We do, however, strongly recommend that you set the termination date before finalising the employee’s last payslip as it may have implications for certain calculations. Once this last payslip is finalised, the employee will move to the inactive list.
You can record an employee’s termination as follows:
- On their profile, click on End Service.
- Select the date of their Last Day of Service.
- Select the Reason for Termination, if appropriate.
- Save.
End Service Checklist
When ending an employee’s service from their profile, you may encounter the End Service Checklist popup. This appears when an employee:
- has a savings balance that you need to pay out
- has a loan balance that still needs to be paid
It serves as a reminder that there are outstanding items for an employee that need to be taken care of as part of the termination process. If you are capturing the termination and the employee only has the last payslip as a draft (i.e. prior payslips have been finalised), you can click on each item in the checklist to open the system item where action is needed.
Please note: This popup will not appear if the reason selected for Ending an employee’s Service is due to COVID-19 Temporary Layoffs.
More information on these items can be found in the following help articles:
Managing an Employee’s End of Service
Once an employee’s service has been ended, you can perform certain actions to manage this. You will need to click on the drop-down list, next to Current Status on the Employees list page then select inactive. From their profile, click on Manage End of Service and then select the relevant option:
Cancel / Undo Termination
This option should be used in cases where the employee’s service did not in fact end and the termination was recorded in error. Undoing an employee’s termination removes all records of the termination and allows you to continue processing payslips for them as usual.
Please do not use this option in cases where the employee returns to work after a break in service. This should be recorded using the re-instatement option discussed further on.
A termination can only be undone if the employee has not been re-instated, and only the latest termination can be undone.
Update Termination Date/Reason
This allows you to edit the employee’s date of termination and / or the reason for the termination.
As with undoing the termination, this can only be done for the latest termination and only in cases where the employee has not been re-instated.
Re-instate the Employee
Use this option if an employee was in fact previously terminated, but is now being employed again. The system will record a new service period for the employee and will ask you for a new appointment date.
This option should also be used for employees returning from long-term absences during which they were still employed. In these cases, a new service period will not be created.
In each of the above instances, the employee’s next regular payslip will be generated for the period in which the reinstatement date falls.
IR56F (Notification by an Employer of an Employee who is about to Cease to be Employed)
On termination of service (or death), the employer must file one copy of IR56F one month before the date of termination of employment.
SimplePay generates this document in PDF format automatically based on the employee’s payroll information. For more information, please see the following article:
Termination Payments
You may be required to make certain additional / special payments to the employee upon / after their termination. These are discussed in detail in the following section:
MPF: Notifying the Trustee
Apart from making the last MPF contribution on time, you are required to notify the trustee of the employee’s termination date for an employee who is enrolled in an MPF scheme. This can be done through the Monthly MPF Remittance Statement or by written notice on or before the next contribution day.
Any employer who fails to notify the trustee before the next contribution day could be liable to a financial penalty.
SimplePay populated the Date of Cessation of Employment on the MPF Remittance Statement. This can be submitted to the trustee.