HR Glossary
Payroll Settlement
The finalization of all dues owed to or by an employee, typically during exit.
Definition
Payroll settlement (often as part of full-and-final settlement) is the process of calculating and disbursing all outstanding dues — final salary, leave encashment, gratuity, and deductions — when an employee leaves the organization.
Why It Matters
A slow or inaccurate settlement process is one of the most common sources of exit-related disputes.