The last paycheck includes all wages for hours worked through the end of the termination date. In some cases, this paycheck will include accrued but unused vacation, severance, and other payments.
Employers should work with their payroll provider to calculate the correct amount for the number of days worked in the final pay period before termination, plus any PTO amounts that must be paid out, and minus any deductions.
Administrators should contact their payroll provider for assistance in calculating the amount of an employee's last paycheck. Those with Zenefits Payroll should refer to these instructions.
Severance pay is additional payment (and potentially benefits) paid to the terminated worker upon termination. Severance packages may be predefined through agreements between the employer and the individual, or defined solely by the employer.
Terminated workers are not always entitled to severance pay upon termination, and employers are (in most cases) not legally obligated to provide severance. However, in certain circumstances (such as mass layoffs), terminated workers may be entitled to severance. Employers should always consult with their legal counsel regarding severance pay.
Zenefits currently does not support severance packages or any other payment at termination for companies who use third-party payroll provider. Those who have Zenefits Payroll, however, can add severance pay in both regular and off-cycle runs.
Admins can cancel a scheduled termination until one day before the termination date. If it is less than one day, admins should contact Zenefits Support.
To cancel a scheduled termination, go to the employee's profile and select "Cancel Termination" in the top notification bar.
Administrators can terminate workers even if they are still setting up benefits. If someone is terminated before benefits are set up in Zenefits, the administrator will need to provide additional information about the following items:
If the worker is enrolled in medical, dental, or vision coverage, the administrator will need to specify when they want the benefits to end. Administrators who choose to manage COBRA coverage will also need to provide some additional information to complete the termination process.
Zenefits does not administer unemployment benefits and is not involved in the unemployment benefits application process.
Employees who quit are not eligible for unemployment.
Workers who have been terminated in Zenefits can still access the Personal Information app in their dashboard. The Personal Information app will include any signed employment documents, agreements with the company, bank info, tax forms, benefits agreements, and basic contact information. If the company had payroll with Zenefits, then the worker can view paystubs and W2's.
If a worker has logged work hours, but has not completed the onboarding process, regardless of the hire date, you will have the option to Terminate them from the Actions drop down menu on their profile.
After an employee is terminated in Zenefits, in most cases, the employee's benefits coverage will extend to the end of the month in which they were terminated. Some companies may have same-day or mid-month termination policies.
Upon termination, two types of insurance become available to terminated employees.
COBRA and Unemployment Insurance (UI) are not the same. COBRA is a continuation of employer health coverage while unemployment insurance are benefits paid by the state to eligible unemployed individuals. Zenefits does not administer UI.
When an employee who was enrolled in coverage is terminated, they may be eligible for Federal or State COBRA, which is an extension of their current benefits for a certain amount of time. Federal COBRA lasts up to 18 months, while State Continuation varies from state to state. An employee can elect to enroll in and pay the whole cost for medical, dental, and vision policies that they were enrolled in at the time of termination. State COBRA, however, may allow continuation for only medical insurance policies.
For life and disability insurance, some carriers allow for group policies to be switched to individual policies. Contact your broker for more information.
Termination types are a commonly used tool for HR administrators to track the nature of historical terminations, e.g., in the event that a previously terminated employee reapplies to the same company.
There are two main termination types: Voluntary (Regretted or Non-Regretted) and Involuntary:
There is no legal requirement for reporting termination types, but some states have specific requirements for furnishing an employee's final paycheck according to the type of termination.
At-will employment means that employers are able to terminate a worker at any time, with or without "just cause," as long as termination is not discriminatory.
Zenefits does not provide legal guidance on the terms of employment or termination. Please seek legal counsel for any legal or compliance questions relating to at-will employment or termination.
Federal law states that terminated employees must be paid within their regular pay period, but states have their own individual laws for furnishing employees with their last paycheck. Employers should check with their legal counsel about compliance with the proper state law, especially for remote employees (governed by the employee's work state, not the employer's state).
If an employee is terminated, their deductions or other payroll information will stop being pushed to payroll on their termination date.
In Zenefits, administrators can terminate any worker, including managers. Managers can submit a termination request for their direct reports, and subordinates of those reports. The request is sent to the appropriate approver for review and approval. Aside from this approval step, the termination process in Zenefits is essentially the same for both managers and administrators.
Administrators can edit termination classification and reason after the termination date has passed.