Final pay

Final pay is what an employer owes an employee when their employment ends.

It's best practice for an employee to be paid on their last day of work or on the next scheduled pay day.

Final pay payments

An employee should get the following entitlements in their final pay:

• outstanding wages for hours they have worked, including penalty rates and allowances
• any accumulated annual leave, including annual leave loading if it would have been paid during employment
• if it applies:
  • accrued or pro rata long service leave
  • payment in lieu of notice
  • redundancy pay.

Sick and carer’s leave is not paid out when employment ends.

https://www.fairwork.gov.au/ending-employment/notice-and-final-pay/final-pay 

Page reference No: 2020

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Instructions

1. Check with Teresa or your payroll officer whether EMPLOYMENT TERMINATION PAYMENT (ETP) applies 
   1. (this is not to be confused with termination pay. ETP is like a gratitude payment, similar to how directors of big companies get a huge payout when they retire)
2. Employer must pay all outstanding wages and unpaid leave on the day employee ceases working, unless you have entered into a separate arrangement regarding the termination pay or there are instructions by fairgov.
3. For the unused leave, employees are to be paid
   1. ensure the payroll category used is UNUSED LEAVE not an actual PAID LEAVE category. 
   2. unused long service leave (if worked for atleast 5 years for NSW. Check the laws of your respective state)
   3. unused annual leave (see here for reference)
   4. you are not entitled to receive payment for unused sick leave (see here for reference)
   5. note that you do not earn super guarantee for unused leaves (see here for reference) 
   6. note that you are entitled to an additional payment of leave loading of 17.5% (or a different % based on your employment contract or fairgov rates) on top of your unused leave payment. 
4. Allowances - check with the award applicable. Generally, allowances is pro-rata on the days they worked. So adjust accordingly.

For more details click here