Guide
Full and Final settlement (FNF): process overview
Full and Final settlement (F&F / FNF) is the exit pay and clearance process after employment ends: settle amounts owed in either direction, recover company property, and close the employee’s active relationship with the organization. Exact components and timelines are jurisdiction- and policy-dependent.
Direct definition
When an employee resigns or otherwise exits, HR and finance calculate a settlement that may include unpaid salary, leave encashment, notice pay recovery, deductions, and clearance against assets or other holds. The settlement is recorded and paid (or recovered) according to company policy and applicable law.
Typical components (generic)
- Unpaid salary through last working date (LWD)
- Leave encashment where policy allows
- Notice pay recovery or payment in lieu, if applicable
- Other recoveries (advances, loans) where documented
- Pending asset returns and clearance status
Not every exit includes every line item. Your worksheet should match policy, not a generic internet template.
Process steps
- Resignation / exit initiation — capture notice period and expected LWD.
- Review — manager/HR accept, adjust LWD, or reject per policy.
- Work through LWD — knowledge transfer, access wind-down planning, asset return scheduling.
- Settlement — prepare FNF worksheet, verify amounts, obtain approvals.
- Exit close — mark account inactive when appropriate, complete clearance, and archive records.
Asset recovery dependency
Pending laptops, badges, and other company property often block clearance. Treat asset return as part of FNF — not an afterthought — using a handover checklist such as employee asset handover.
What Dayzen FNF worksheets cover
In Dayzen employee lifecycle, employees can submit resignations with notice period and LWD calculation; managers/HR can accept, modify LWD, or reject. After LWD, accounts can be marked inactive and FNF settlement triggered. Full & Final worksheets cover unpaid salary, leave encashment, notice pay recovery, pending asset returns, and clearance status — with asset visibility connected to asset management.
Dayzen does not claim to automatically perform every statutory exit filing or bank payout step as part of FNF. Payroll remains calculation-focused for regular pay runs; keep filing/disbursement ownership clear for exit payments too.