Final settlement

Full and final settlement, worked out for you.

When an employee leaves, Flowyana works out their full and final settlement from the resignation: unpaid salary, leave encashment, notice pay or its recovery, and open employee advances. Approve it, post it to your books and pay it, with every line explained.

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Unpaid salary up to the last working day
Leave encashment of the remaining balance
Notice pay in lieu, or recovery for notice not served
Approval, accounting entries and payment in one place

What is Final settlement in Flowyana?

Flowyana final settlement software works out what a leaving employee is owed, and what they owe, in one settlement. It is part of HR & Payroll and starts from the resignation, so the last working day and notice period are already on record. It suits businesses in the UAE, Saudi Arabia, India and elsewhere that settle leavers in-house.

A full and final settlement is usually rebuilt by hand from the last payslip, a leave balance and a list of advances, and it is easy to miss one. Flowyana fills in each part for you: salary for the days since the last payslip, encashment of the remaining leave, notice pay in lieu or recovery for notice not served, and any open employee advances. Each line shows how it was reached.

You can add earnings or deductions of your own, then approve the settlement directly or through your approval workflow. Approval posts it to your books, and paying it records the payment and moves the employee to their exit status. Cancelling reverses its entries.

As of October 2026 Flowyana does not calculate end-of-service gratuity and does not prepare government filings. Gratuity can be added as your own line on the settlement.

What it does

Final settlement, in practice.

Starts from the resignation

A settlement is created from an approved resignation, using its resignation date, notice period and last working day.

Unpaid salary

Salary for the days worked since the last payslip, up to the last working day.

Leave encashment

Remaining leave is paid out at the employee’s daily rate, for the leave types you allow to be encashed.

Notice pay and recovery

For notice not served, choose to recover it from the employee, pay it in lieu, or waive it.

Employee advances

Advances the employee has not yet settled are deducted, so nothing is left open on their account.

Your own lines

Add earnings or deductions of your own, such as a bonus or an equipment charge, beside the worked-out lines.

How each line was reached

Every line shows its basis, such as the days and the daily rate, so the employee and the accountant can follow it.

Approval

Approve the settlement directly, or send it through your approval workflow before it can be paid.

Posted to your books

Approving posts the settlement to your accounts; paying it records the payment date and method and posts the payment.

Cancel and reverse

Cancelling a settlement reverses what it posted to your books, so a corrected one can be made.

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How it works

Final settlement, step by step.

1
Approve the resignation
Record the resignation with its notice period and last working day, and approve it.
2
Create the settlement
Start a final settlement from the resignation and choose how to treat any notice not served.
3
Review the lines
Check unpaid salary, leave encashment, notice and advances, and add your own lines if needed.
4
Approve and post
Approve it directly or through your workflow; the settlement is posted to your books.
5
Pay it
Mark it paid with a date and method. The employee moves to their exit status.

In depth

A closer look.

What goes into a full and final settlement

Each settlement is built from the employee’s own records. Unpaid salary covers the days from the end of the last payslip to the last working day, using their salary structure. Leave encashment pays the remaining balance of each leave type you allow to be encashed. Notice compares the notice period with the time served. Open employee advances are deducted. The total earnings, total deductions and net amount are shown together.

Unpaid salary to the last working day
Leave encashment at the daily rate
Notice pay in lieu or recovery
Open employee advances deducted

Notice pay and notice recovery

When an employee leaves before their notice period is up, the days not served are worked out from the resignation date and the last working day. You decide what happens to them: recover them from the employee as a deduction, pay them in lieu as an earning, or waive them. The value uses the employee’s daily basic pay, and the line shows the days and the rate.

Days not served worked out for you
Recover, pay in lieu or waive
Valued at the daily basic
Basis shown on the line

Approval, accounts and payment

A settlement starts as a draft and is approved by someone allowed to approve it, or by your approval workflow. Approval posts the settlement to your accounts by line, so salary, leave, notice and advances reach the right ledgers. Marking it paid records the date and method and posts the payment. If a posting cannot be made, the reason is shown and it can be retried once fixed.

Draft, approved, paid or cancelled
Direct approval or workflow
Posted to your books by line
Posting problems shown and retryable

Closing the employee’s file

Paying the settlement moves the employee to their exit status, so they drop out of headcount while their record and history stay. Relieving and experience letters are generated from the resignation and filed in the employee’s documents. Cancelling a settlement reverses its entries, so a corrected one can be made.

Employee moved to exit status on payment
Letters filed in employee documents
Cancel reverses the entries
Former staff out of headcount

Who it’s for

Businesses that run on Final settlement.

Companies in the UAE and Saudi Arabia

Leavers settled with salary, leave and notice in one approved figure, with gratuity added as a line of your own.

Companies in India

Full and final settlement with leave encashment, notice recovery and advances, approved before payment.

Retail and restaurant chains

Frequent leavers at each branch settled the same way every time, with entries reaching the books.

Contracting and service firms

Advances given to staff in the field deducted automatically when they leave.

Growing offices

A settlement the accountant can read line by line, instead of a spreadsheet rebuilt for each leaver.

Questions

Asked about final settlement.

What is a full and final settlement?

A full and final settlement is the last payment to an employee who leaves: salary still owed, leave paid out, notice adjustments and any amounts the employee owes the business, netted into one figure. In Flowyana it is worked out from the resignation and the employee’s pay, leave and advances.

Does Flowyana calculate final settlement?

Yes. It works out unpaid salary to the last working day, leave encashment of the remaining balance, notice pay or recovery for notice not served, and deducts open employee advances. You can add your own earnings or deductions before approving it.

How is leave encashment worked out in a final settlement?

The remaining balance of each leave type that allows encashment is paid at the employee’s daily rate, taken from your payroll policy. Leave already paid out on a payslip or an earlier settlement is not paid again.

What happens if the employee did not serve their full notice?

Flowyana compares the notice period with the days between the resignation and the last working day. For the shortfall you choose to recover it from the employee, pay it in lieu, or waive it.

Are employee advances deducted?

Yes. Advances the employee has not yet settled are deducted from the settlement, so their account is closed when they leave.

Does the final settlement go into the accounts?

Yes. Approving it posts the salary, leave, notice and advance lines to your books, and marking it paid posts the payment with its date and method. If posting fails, the reason is shown and you can try again.

Can a final settlement be approved before payment?

Yes. A settlement moves from draft to approved, directly by someone allowed to approve it or through your approval workflow, and only then can it be paid.

What happens when the settlement is paid?

The payment is recorded and posted, and the employee moves to their exit status, so they no longer count as staff. Their record and history stay.

Can I cancel a final settlement?

Yes. Cancelling reverses what it posted to your books, so a corrected settlement can be made.

Does it calculate end-of-service gratuity?

No. As of October 2026 Flowyana does not calculate end-of-service gratuity or benefits. If you owe gratuity, add it as your own earning line on the settlement, and it is approved, posted and paid with the rest.

Is final settlement suitable for the UAE, Saudi Arabia and India?

Yes for salary, leave, notice and advances in your own currency. Gratuity and government filings for any country are outside Flowyana as of October 2026.

Which plans include final settlement?

HR & Payroll Growth and Business include it; the Starter plan does not. On other plans, add HR & Payroll together with the Shifts, onboarding & exits add-on.

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