How to handle employee offboarding

As your business grows and changes, employees may resign, be dismissed, or take an extended leave. At Wave, we've made it easy to correctly off-board your employees!

In this FAQ, you will learn how to correctly off-board or place an employee on leave in Canada.

To skip to the section that covers employees taking a leave of absence or unpaid leave, click here.

To skip to the section that covers off-boarding a resigned or terminated employee, click here.

How do I navigate to the off-boarding section for an employee?

  1. Click the Payroll tab on the left side navigation bar
  2. Select the Employees tab and select the name of the employee to be offboarded on the next page
  3. Select the Employment Status button

 


Leave of absence

If an employee is taking unpaid leave, which is typically a leave of more than 7 days with intent to return to employment at your business, then you will need to place the employee on leave.

To start the process of placing an employee on leave, navigate to the employment status section of the employee as outlined above and select the Place on leave button

Before placing your employee on leave, you will need to know the employee's:

  • Last day worked
  • Date of return

Afraid of choosing incorrect dates? Don't worry – Wave won't let you choose a date that prevents you from properly placing your employee on unpaid leave.

After choosing the last day work and date of return, Wave will calculate the following fields based on past approved payrolls and any relevant future payroll periods:

  • Final pay period (last payroll period that this employee is active)
  • Payday deadline (Wave recommends you to pay this employee by this date to stay fully compliant with the CRA)
  • ROE deadline (Wave recommends you to issue the ROE by this date to stay fully compliant with the CRA)

After confirming the leave of absence, you'll be redirected to the employee's modified Employment Status. Click here to skip to the final task list of off-boarding an employee.


Off-boarding a terminated or resigned employee

If an employee is resigning, being dismissed with cause, or being dismissed without cause then you will need to off-board your employee.

To start the process of off-boarding an employee, navigate to the employment status section of the employee as outlined above and select the Start Off-boarding button

Before off-boarding your employee, you will need to know the employee's:

  • Termination reason (resignation, dismissed without cause, or dismissed with cause)
  • Last day worked
  • Date of notice

Afraid of choosing incorrect dates? Don't worry – Wave won't let you choose a date that prevents you from properly off-boarding your employee.

After choosing the last day work and date of notice, Wave will calculate the following fields based on past approved payrolls and any relevant future payroll periods:

  • Final pay period (last payroll period that this employee is active)
  • Payday deadline (Wave recommends you to pay this employee by this date to stay fully compliant with the CRA)
  • ROE deadline (Wave recommends you to issue the ROE by this date to stay fully compliant with the CRA)

As this employee will not be employed after the final pay period, Wave checks for any pay that this employee is entitled to be paid. Entitlement to particular types of pay is based on the reason for termination and the applicable provincial laws. Here's the list of pay that we check for:

  • Dismissal pay
  • Severance pay
  • Vacation pay (calculated at the time of the last payroll period)
  • Regular, holiday, overtime and sick pay (calculated at the time of the last payroll period on the timesheets page)

After confirming off-boarding, you'll be redirected to the employee's modified Employment Status.


Leave of absence and off-boarding final task list

After confirming either the leave of absence or off-boarding you will be redirect to the Employment Status page of the employee. You'll see a final task list to show you what needs to be done before the employee leaves your company.

The final task list will include the following tasks and a recommended date of completion:

  • Complete timesheets
  • Provide pay
  • Issue ROE

Note: if the recommended payday for the provide pay task is before the payday of the normal last payroll period of the employee, then you will have an option to run a one-off payroll for only this employee. More details below.

After all three steps of the final task list are complete, you have successfully off-boarded your employee!

Provide pay to terminated employees as a one-off payroll run:

One-off payrolls are only able to be created if the employee's final pay is recommended before the payday of the regular last payroll period

When you are ready to approve the payroll that is also the final payroll period for a terminated employee, you will have the option to run a separate payroll for this employee. This will allow you to provide the pay for the terminated employee within the recommended date of completion given in the final task list.

Wave will automatically pay out any vacation balance when an employee is terminated, including leave of absence and resignation.

To run the separate payroll for the employee, simply click the Pay them separately button. Review and approve the separate payroll when you are ready. After approving your one-off payroll, your next payroll will return to the original payroll period without the terminated employee who was included in the one-off payroll.


Frequently Asked Questions

Why is my terminated employee receiving vacation pay on their last payroll?

Any outstanding vacation balance is paid out for all terminated employees on their last payroll run. This includes the vacation hours balance, and any vacation hours they will earn for their last payroll period if their vacation policy is set to accrue. To change the vacation balance or vacation policy, click the Payroll > Employees > select the employee's name > click the Vacation page > press the pencil icon beside vacation balance, and/or click the Vacation Policy button.

One-off payrolls are pretty neat! I forgot to pay one employee last payroll, can I run a one-off payroll for them?

Unfortunately, one-off payrolls are only for terminated employees who must be paid before the regular payday for their last payroll period. In other words, if the date of completion for their Provide pay task is earlier than the payday of their last payroll period, then the terminated employee will be eligible to be included in a one-off payroll.