The Last Payslip Someone Gets
A leaver’s last pay is the one payslip assembled from five places at once — the calendar, the leave balance, the contract, the loan ledger and the advances book. Since 14 October it is its own payroll run, proposed from the records, and every figure on it is HR’s to change before it is paid.
Wanjiru, an accounts assistant at a Nairobi logistics company, resigns. Her last working day is Friday 16 October. Somewhere in the next fortnight someone in HR has to work out what she is owed and what she owes, and in most offices that someone opens a spreadsheet, the leave register, last month’s payslip and the staff loan file, and starts typing. The arithmetic is not hard. Assembling it is, and the assembly is where final dues go wrong.
Why the last payslip is different
A regular payroll run pays everyone the same kinds of thing every month. A final settlement pays one person things they have never been paid before — part of a month, leave turned into money, pay instead of notice, perhaps a gratuity under their contract — and takes back things that were never meant to come off a payslip in one go, like the rest of a staff loan. Each figure lives in a different record, and the person preparing it is usually doing so for the first time this year.
So since 14 October a final settlement in AWRA is a payroll run of its own. HR starts it from the leaver’s profile — the Loans & Final Pay card carries a Prepare Final Settlement button — or from New Payroll Run on the Final settlement tab. It needs the permission to run payroll and a work country on the profile, because the work country decides which public holidays and which statutory rules apply. The staff loans and final settlement page sets out everything the run proposes and recovers.
What the form proposes, and from where
The form fills itself from what the system already holds, and nothing on it is final until HR saves it. The daily rate is basic salary divided by the standard working days you set on the run. Salary to the last working day counts the working days from the first of the month to the last day on your working calendar, with the work country’s public holidays taken out. Leave lists each paid leave type with what is left of this year’s balance, and HR ticks which to encash and how many days.
Wanjiru’s proposed earnings
Every line is a proposal. HR can change the days, type an amount instead, or untick a leave type before saving.
Notice pay in lieu is a number of days at the daily rate, or an amount HR types where the contract states one. Gratuity, severance and any other earning are amounts HR enters, because the basis for each lives in a contract or a policy, not in a payroll field. If Wanjiru had no contract on file, the daily rate would be zero, the form would say so, and HR would type every amount directly.
When October has already been paid
If a regular run for the month has already been approved or paid with Wanjiru on it, the form proposes no salary to the last working day — she has had the month. Any overpayment for days after she left is HR’s to recover, and an off-cycle run with a Recover line is one tidy way to do it.
What she owes comes off the same run
The last section of the form, Recover what is owed, lists her open employee loans with their outstanding balances and her issued staff advances from accounting. HR ticks which to recover. Loans and advances are listed separately because they are different things in the books: a loan is a receivable repaid through payroll, an advance is money handed out for a purpose and retired against receipts. A recovered advance is retired as cash returned when the run is posted.
| Owed by Wanjiru | Balance | Ticked | What happens at posting |
|---|---|---|---|
| Employee loan (school fees, issued in March) | KES 30,000.00 | Yes | Repayment recorded against the loan, which closes |
| Travel advance, Mombasa trip, unretired | KES 8,000.00 | Yes | Advance retired as cash returned |
Recoveries never take the final pay below zero. Had Wanjiru’s earnings after tax been smaller than what she owed, the loan recovery would stop at what the pay allowed, and the remainder would stay open on the loan for HR to recover by hand or write off with a reason. A negative payslip is not a recovery; it is a dispute with a payslip attached. How loans run month to month is covered in carrying a salary advance into payroll.
The form proposes. HR decides. The run records who decided what.
Taxable is a switch, and it starts ticked
Every earning on the form carries a Taxable switch, and every one starts ticked. AWRA applies no automatic country-specific relief to severance, gratuity or notice pay, because the treatment depends on the country, on the reason for leaving and sometimes on how the payment is structured. The safe default is to tax; HR unticks an item only where it has been advised to. Ask your payroll adviser before the run is approved, not after the P10 is uploaded.
Save and Calculate then runs the settlement through the same statutory engine as every other payroll. Tax is worked out on the month’s combined approved and paid pay, so a settlement in a month that already had a regular run is taxed on top of it, with bands and relief applied once. The run is approved and posted like any other, the net payment lands in the Payments Register, and the employee profile shows the settlement and its status. The P10, NSSF and SHIF files and her P9 merge her payslips for the month into one row; your organization uploads them to each authority and makes the payments itself.
The rest of the exit
Pay is one workstream of four. The starter leaver checklist puts the others beside it — handover, company assets returned, access revoked, final pay settled, an exit interview and a Certificate of service issued task for HR, which the Employment Act expects every leaver to receive. Exits done properly walks the whole sequence; this post is only the part with a number at the bottom.
Four questions to ask any payroll about a leaver
Where does the leave figure come from?
A good answer sounds like
The live leave balance for the leaving year, per paid leave type.
What it tells you
A typed number is last year’s spreadsheet with a new date on it.
What if the month has already been paid?
A good answer sounds like
No salary is proposed, and you can see why.
What it tells you
Otherwise the leaver is paid the same days twice.
Can a recovery make the payslip negative?
A good answer sounds like
No — it stops at the pay available and leaves the remainder open.
What it tells you
A negative payslip cannot be paid and will be argued over.
Who decides whether severance is taxable?
A good answer sounds like
HR, item by item, with a default to tax.
What it tells you
Software that decides it for you has made a tax judgement nobody signed.
What AWRA OpsHub does today
- A final-settlement payroll run started from the leaver’s profile or from New Payroll Run.
- Salary to the last working day from the working calendar and the work country’s public holidays, at basic ÷ standard working days, and none where a regular run already paid the month.
- Leave encashment per paid leave type from the live balance, notice pay in lieu as days or an amount, and gratuity, severance and other earnings as entered amounts.
- Recovery of ticked employee loans and staff advances, never below zero, with a recovered advance retired as cash returned at posting.
- A Taxable switch on every earning, ticked by default, and the same statutory engine and approve-then-post lifecycle as any run.
More we can add to your workspace
- A statutory severance proposal — for a Kenyan redundancy, 15 days’ pay for each completed year of service — for HR to confirm or change.
- A settlement statement for the leaver that itemises every earning, deduction and recovery, ready for signature.
Where we point you to a specialist
- Whether a payment on leaving is taxable, and at what rate, is a tax question for HR and your adviser. The system applies the switch you set and never decides it.
- Producing the P10, NSSF and SHIF files is ours; uploading them and paying the authorities stays with your organization.
Settlements with less typing
The proposal covers what the records already hold. Two requests come up from HR teams who run several exits a month.
Statutory severance, proposed
A redundancy severance figure worked out from completed years of service at the rate your country sets, shown as a proposal HR confirms.
A statement to sign
One page for the leaver listing every line of the settlement and every recovery, so the conversation is about a document, not a memory.
Tell us how exits run in your organization and we will return a written scope and cost.
Scope the leaver workflowOur position
Start every exit from the profile, not from a spreadsheet. Let the form propose, check the leave days and the recoveries against what the leaver expects, decide each Taxable switch with your adviser, and only then approve. The settlement that causes a dispute is almost never the one with a wrong rate; it is the one where nobody could show where a figure came from.
See final settlement in the HR docs
Step by step: off-cycle runs, the settlement form, recoveries and how tax is charged across a month with more than one run.
Off-cycle runs & final settlementFrequently asked questions
How does AWRA work out salary to the last working day?
It counts the working days from the start of the month to the last working day on your working calendar, leaving out the work country’s public holidays, and pays them at basic salary divided by the standard working days on the run. If a regular run already paid the person for that month, no salary is proposed.
Where does the leave encashment figure come from?
From the employee’s remaining balance for the leaving year on each paid leave type. HR ticks which types to encash and can change the number of days.
Can a final settlement recover a staff loan?
Yes. Open employee loans and issued staff advances are listed on the form and HR ticks which to recover. Recoveries never take the final pay below zero; anything left stays open for HR to recover by hand or write off.
Is severance taxed automatically?
Every earning on the settlement has a Taxable switch that starts ticked. AWRA applies no automatic country-specific relief, so HR decides the treatment of each item, ideally with a payroll adviser.
Does AWRA file the leaver’s PAYE with KRA?
No. AWRA produces the P10, NSSF and SHIF files and the P9 ready for upload, with the month’s payslips merged into one row per employee. Your organization uploads them and pays the authorities.
