Full and final settlement, often shortened to FnF, is the process of squaring everything up when someone leaves. It runs in both directions: what the company owes the employee, and anything the employee owes the company.
What it typically includes
- Salary for the final part-month worked
- Payment for accrued but unused leave
- Statutory entitlements such as gratuity or end-of-service benefit, where the service condition is met
- Any pending reimbursements, incentives or bonus payable on exit
- Deductions for notice not served, unreturned equipment or outstanding advances
Why it takes time
Settlement usually lags the last working day, often by several weeks. Some components cannot be calculated until the payroll cycle closes, statutory contributions have to be finalised, and equipment recovery or handover sign-off may be outstanding. Many jurisdictions nevertheless set a legal deadline, and missing it can attract a penalty.
Why it matters when hiring internationally
Offboarding is where employment relationships most often turn contentious, and a slow or incorrect settlement is the usual trigger. It is also where the difference between providers shows most clearly: the calculation depends on having tracked leave, service dates and statutory accruals accurately for the whole employment. Worth asking a provider what their standard settlement timeline is, and what happens if it slips.