Employee Offboarding & Settlement
When it's time to end an EOR employment relationship, Omnivoo handles the offboarding process — including generating the Full & Final (F&F) settlement, processing final payments, and completing compliance requirements. This guide walks you through the entire process.
Initiating Termination
To begin the offboarding process:
- Go to the employee's detail page from the EOR Dashboard.
- Click "Terminate Employee" on the Overview tab.
- Fill in the termination details:
| Field | Description | Required |
|---|---|---|
| Reason for Termination | Select from: Resignation, Mutual Agreement, Performance, Redundancy, End of Contract | Yes |
| Last Working Date | The employee's final day of work | Yes |
| Waive Notice Period | Toggle to waive the contractual notice period | No |
Termination is a significant action. Once initiated, it triggers the settlement calculation and compliance offboarding. Make sure you've confirmed the decision and last working date before proceeding.
Notice Period
The notice period depends on the employee's country and contract terms:
- India — Typically 30-90 days (as per contract)
- US — At-will unless contract specifies otherwise
- EU countries — Varies by country and tenure (often 1-3 months)
If you choose to waive the notice period, the employee's last working date is immediate, but you may still owe notice period pay as part of the settlement.
Full & Final Settlement
After termination is initiated, Omnivoo automatically calculates the Full & Final (F&F) settlement. This is a comprehensive accounting of everything owed to — and owed by — the employee.
Earnings
| Component | Description |
|---|---|
| Pro-rata Salary | Salary for days worked in the final month |
| Leave Encashment | Payment for unused earned/paid leave balance |
| Gratuity | Statutory gratuity (India: applicable if tenure >= 5 years, or per company policy) |
| Bonus / Variable Pay | Any pending bonus or incentive payments (pro-rated if applicable) |
| Notice Period Pay | If the employer waives the notice period, this amount is owed to the employee |
Deductions
| Component | Description |
|---|---|
| Unpaid Salary Advances | Any salary advances that haven't been repaid |
| TDS (Tax Deducted at Source) | Final tax deduction on settlement earnings |
| Recovery of Advances | Company loans, relocation advances, or other recoverable amounts |
| Other Deductions | Equipment charges, training bond recovery (if applicable) |
Net Settlement Calculation
Pro-rata Salary
+ Leave Encashment
+ Gratuity
+ Bonus / Variable Pay
+ Notice Period Pay (if applicable)
─────────────────────────
= Total Earnings
- Unpaid Advances
- TDS
- Recovery of Advances
- Other Deductions
─────────────────────────
= Total Deductions
Net Settlement = Total Earnings - Total Deductions
The settlement calculation is generated automatically based on the employee's contract terms, attendance records, leave balance, and applicable statutory rules. You can review each line item before approving.
Settlement Approval Process
The F&F settlement goes through an approval workflow before payment is processed:
- Settlement Generated — Omnivoo calculates all earnings and deductions automatically.
- Employer Review — You review the settlement breakdown on the employee's detail page.
- Adjust if Needed — Add or modify deductions (e.g., unreturned equipment, pending advances) with supporting notes.
- Approve Settlement — Click "Approve Settlement" to confirm the final amounts.
- Employee Acknowledgment — The employee receives the settlement details for their records.
Review the settlement carefully before approving. Pay special attention to leave encashment days and any pending advances. Once approved, the settlement moves to payment processing.
Settlement Status Tracking
| Status | Meaning |
|---|---|
| Draft | Settlement calculated, pending employer review |
| Under Review | Employer is reviewing the breakdown |
| Approved | Employer approved, pending payment |
| Paid | Settlement amount disbursed to employee |
| Disputed | Employee raised a dispute (rare, handled by Omnivoo) |
Payment Processing
After the settlement is approved:
- Omnivoo processes the payment — The net settlement amount is disbursed to the employee's registered bank account.
- Final payslip generated — A detailed payslip showing all settlement components is created.
- Tax documents — Final tax certificates (e.g., Form 16 for India) are generated and made available for download.
- Compliance closure — Omnivoo deregisters the employee from statutory bodies as required (PF, ESI, etc.).
Settlement payment is typically processed within 5-7 business days after approval. For India, the timeline may vary based on PF transfer processing.
Post-Termination
After the settlement is paid:
- The employee's status changes to Terminated.
- All employment records, payslips, and documents remain accessible in read-only mode.
- The employee is removed from active payroll.
- Compliance filings related to the employee are finalized.
Common Questions
Can a terminated employee be re-hired? Yes. You can hire them again through the standard hiring process. A new employment contract will be generated.
What if the employee disputes the settlement? Omnivoo mediates settlement disputes. Contact support with the details, and we'll work with both parties to resolve it.
How is gratuity calculated for India? Gratuity = (Last drawn Basic Salary x 15 x Years of Service) / 26. Statutory gratuity applies after 5 years of service, but companies may offer it earlier per policy.
What's Next?
- EOR Compliance Dashboard — Ensure all final filings are complete.
- EOR Dashboard — Return to your dashboard.
- Hiring an EOR Employee — Need to backfill the role? Start a new hire.