Process an Employee Departure

Whenever an employee leaves, you must continue to keep a record for the employee so that you can send them the appropriate government forms and remit any payments to the government at the end of the fiscal year.

To process an employee departure:

1. Issue the employee their final paycheck.
2. Print the employee's W-2 form and give it to them. You can print it when the employee departs, or print it with the other W-2s at the end of the year. If you print the W-2 after the employee's departure, ensure that the employee provides a forwarding address.
3. Make the employee inactive, so that you don't inadvertently continue to issue checks to them. In some cases, you will not want to make the employee inactive even though you have filled in the Terminate box. For example, if a salesperson leaves your company before all of the sales that they made have been processed, you will want to keep that salesperson active so that you can issue the commission check in the future.