Employment termination payments (ETP)

Before creating your ETP for an employee, consider the following items to help ensure a smooth process: 

• Ensure the employee is terminated on their profile with a future archive date set.
  • This also helps you pay out any accrued leave entitlements for full-time or part-time permanent employees as part of the termination process.
    
     Please note: Archived employees cannot be paid, so select a future archive date to allow enough time to process all payments for the employee, including ETPs.- 
• Process the final pay for the employee and ensure any remaining leave is paid out if necessary.
  
   Please note: Unused TOIL or RDOs cannot be paid through a normal payslip. Instead, you may need to pay these unused balances via an Employment Termination Payment (ETP).
   
• Ensure you have access to create and process ETPs in your User Permissions. You may need to reach out to your platform Super User if this is not the case. 
• Determine your ETP type and the relevant ETP code.
• Determine the taxable component of the relevant ETP.

Once you have paid out the employee's remaining leave entitlements, including any accrued but unused annual or other leave types, you are now ready to proceed with creating the Employee Termination Payment (ETP).

If you still need to action the payment for the employees' remaining hours of work or eligible entitlements, please refer to the links in our section above.

To create a new ETP:

1. Navigate to the Pay page. Select the down arrow next to the Add Payslip button.
2. Select + ETP to go to the Employment Termination Payment page.
   
   
3. Under the Employee details tab, you can enter the following:
   • Employee's name
   • Employee's Operation 
     
       Hot tip: This field will pre-fill for employees with an operation assigned on their profile. 
      
   • Cost Code (optional)
   • Payment date
   • Select the checkbox to indicate if the payment will be Subject to Payroll tax. If so, select the relevant Payroll tax state.
   • Select the checkbox to indicate if the payment is to be Included in WorkCover Premium. If so, select the applicable WorkCover rate.
     
       Please note: Selecting either checkbox will allow you to view the selected rate in the Advanced Payroll Activity Report (APAR).
     
     
4. Next, fill in the details from the Termination payment tab, starting with the Payment Label (this is optional and will display on the ETP payslip as the payment item name).
5. Select the Benefit type, choose from:
   • Life Benefit (Code R, Code O, Code S, Code P)
   • Death Benefit (Code D, Code N, Code B, Code T)
     • Select each code to receive more information about each benefit code.
       
         Please note: Our team cannot advise on which code to use. For more information on selecting Life Benefit or Death Benefit, read this helpful ATO document on ETP reporting. 
6. Input the values for the termination, including:
   • Tax-Free Component
   • Taxable Component
   • Total tax
   • Superannuation
     
       If you need assistance with determining the taxable component for your ETP, the ATO has provided a helpful resource, which you can access here. 

7. If you need to add another payment to this ETP, select the + Add another payment option before continuing.

   

8. Once the correct values have been added, select Next to Preview the PDF of the payslip. This will calculate the total payment. Here you will see the payment label next to the payslip description.

   

9. If you need to make changes, select Go Back. Or, after reviewing, if you are happy to proceed, select Finalise Payment. 
10. In the confirmation payment pop-up, you can enter any comments for auditing purposes. If your platform uses batching.
    • Select Add to Batch
    • Or, Add to New Batch
11. Confirm and save once complete. This will return you to the main ETP page, where you can view any outstanding ETPs you may have.
    
      Please note: You cannot edit an ETP once you have saved it. Please ensure you double-check your selections before saving. 
12. In Pay > ABA files, you're now able to access the ABA file for this payment.

  Hot tip: The ABA files page will automatically set a filter based on your current period end date. To find past ABAs for your ETP, simply select the right period end date to adjust the filter. 

Viewing an ETP in the Employee App

Once your ABA file for the ETP is created, a PDF of the ETP payslip will also be created and available for the employee to download in their Employee Portal via View Payslips. 

  If your employee is struggling to find where to view their payslips in their Employee App, you can direct them to this helpful employee guide. 

If you have made an error, such as incorrect information or a mistake in your current data, you must delete the existing ETP and then create a new one from scratch to ensure accuracy and compliance.

To delete an ETP:

1. Navigate to the Pay page. Select the down arrow next to the Add Payslip button and select + ETP to access the Employment Termination Payment page.

2. Use the filters to locate the ETP.

   

3. Select the delete icon. Review your choice in the confirmation modal.
   
     Please note: Deleting an ETP is permanent; the ETP cannot be recovered. Deleting the ETP will also delete the associated ABA file. 
4. Once acknowledged, your ETP is deleted.

If you would like to run a report on all Employee Termination Payments for a specific payment date, office code, financial year or employees, you can do so using the ETP Report.

Alternatively, if you already know which employee you are looking for, you can view a history of their ETP payments directly from their Employee Profile. 
 

Using the ETP Report

If you are looking for a comprehensive report that shows you all the details on ETP payments made within your platform, you can use our ETP Report for that. 

Using this report, you will be able to see the following information:

• Employee name
• Operation - The employee was associated with.
• Cost Code/ Purchase Order
• Payment Date 
• Financial Year 
• Type - The code associated with the Benefit type.
• Taxable - The total taxable value.
• PAYG -The total PAYG value.
• Tax Free -The total tax-free value.
• Net -The value that was paid to the employee.
• Created By -The admin user who actioned the ETP payment.

  Please note: This report excludes standard termination payments, for reports on standard termination payments, you can use the Standard or Advanced Payroll Activity Report.

To generate the ETP report: 

1. Navigate to Reports > Financial, and under the Payroll Reports section, select ETP Report.
2. Add the Payment Date From and Payment Date To to filter and search for ETPs made within those specific dates. Alternatively, you can filter by Financial Year to view all payments made during that period. 
3. Optionally, you can further filter your report by selecting specific Office Codes or Employees. 
4. Select Submit to load your report. From this page, you have the option to export your report in either PDF or CSV format. 

Viewing ETPs from the Employee Profile

If you are looking to view the ETP history for a specific employee, including a copy of the PDF payslip for those payments, you can do so from the Employee's Profile. 

Permission Reminder: You will need to have 'Manage Employee Financial Details' enabled in your user permissions to access this part of an employee's profile. 

To view ETPs in the employee profile:

1. Navigate to the employee's profile by either selecting them from one of your People pages or by using the Search function. 
2. From the employees Overview page, navigate to Financial > ETP and select the drop-down arrow.
   
     Please note: The ETP section will only appear in the section for employees with processed ETPs.
3. From here, you can view the following:
   • Payment date
   • Financial year
   • Total payment
   • Type
4. Select the File next to the payment to view the PDF payslip generated for the payment.