When an employee leaves, the last payment they receive is often the largest and the most carefully checked: final salary, unused leave, end-of-service gratuity and allowances, less any advances or fines. In many countries, especially in the Gulf, South Asia and Africa, this is called the full and final settlement, and both the employer and the employee sign that nothing further is owed. This final settlement voucher lays out the calculation clearly and starts with a timeline of the employee’s years of service.
A Timeline of Service
Under the title, a teal bar runs across the page with thirteen tick marks, one for each year, and navy dots at both ends. The left end is labelled “Joined · 1 Mar 2014” and the right end “Last working day · 28 Feb 2026”, with “12 years of service” above the middle. Years of service drive the gratuity calculation, so putting them at the top of the voucher makes the most important number visible straight away.
Employee and Exit Details
Two tables record the voucher and employee (FS-2026-014, Joseph Abraham, employee ID and senior technician) and the exit (reason: resignation with notice served; basic salary of AED 6,000 a month; last salary paid for January 2026; payment date 15 March 2026). The reason for leaving matters because, in some jurisdictions and contracts, it affects gratuity entitlement.
Earnings and Deductions Side by Side
Two tables, teal for earnings and red for deductions, sit next to each other like a payslip:
| Item | Type | AED |
|---|---|---|
| Salary, February 2026 (28 days) | Earning | 9,500.00 |
| Leave encashment (18 days) | Earning | 3,550.68 |
| Gratuity (21 days × 5 years + 30 days × 7 years) | Earning | 62,136.90 |
| Air ticket allowance | Earning | 1,800.00 |
| Salary advance outstanding | Deduction | 2,000.00 |
| Traffic fine (January 2026) | Deduction | 400.00 |
Each side has its own total row: total earnings of AED 76,987.58 and total deductions of AED 2,400.00. A line for a company phone not returned shows zero, because the phone came back before the voucher was finalised.
How the Sample Gratuity Is Worked Out
The sample follows a common Gulf-style formula: 21 days of basic salary for each of the first five years of service, and 30 days for each year after that. The daily rate is the monthly basic multiplied by 12 and divided by 365, which is AED 197.26. Five years at 21 days is 105 days, and seven years at 30 days is 210 days, so the gratuity is 315 days at the daily rate, AED 62,136.90. Leave encashment uses the same daily rate. Gratuity rules differ by country and change over time, so always check the current labour law and the employment contract before using any formula.
The Net Payable Band
A dark band across the page shows the result: “NET AMOUNT PAYABLE”, the net in words (“Seventy-Four Thousand Five Hundred Eighty-Seven dirhams and 58/100 fils”) and the figure in large type, AED 74,587.58.
Clearance Before Payment
Six tick boxes record the clearance process: laptop and tools returned, ID and access card returned, accommodation vacated, visa cancellation filed, company phone returned and exit interview done. In the sample, everything is complete except the exit interview. Many employers release the final settlement only when clearance is complete, so the checklist shows exactly what is outstanding.
The Employee Declaration
A declaration box states that the employee has received the amount in full and final settlement of all dues and has no further claims. Signature lines for the employee, the HR manager and the finance manager follow. Because the declaration is significant, give the employee time to read the calculation before signing, and a copy to keep.
Preparing a Final Settlement, Step by Step
- Confirm the last working day and the reason for leaving.
- Calculate salary to the last day, leave balance and gratuity.
- Add allowances due under the contract, such as an air ticket.
- Deduct advances, loans and authorised fines.
- Complete clearance, then prepare and sign the voucher.
- Pay within the period your labour law requires.
Retirement, Termination and Contract End
The same voucher handles retirement, termination by the employer, redundancy and the end of a fixed-term contract. Change the reason in the exit table, and add lines for any notice pay in lieu, severance or redundancy payments your law or contract requires.
Other Currencies and Countries
The sample is in UAE dirhams, but every label is editable. Change the currency to riyals, rupees, naira or any other, and rename “Gratuity” to “End-of-service benefit”, “Severance” or the term your law uses.
Recolouring the Earnings and Deductions Colours
The teal and red table headers make earnings and deductions easy to tell apart. Keep that contrast if you change colours, for example green and red, or blue and orange.
Keeping Settlement Records
Download As PDF and file the signed voucher in the employee’s personnel file with the resignation letter, clearance form and bank transfer confirmation. Final settlement records are often requested in later disputes or visa checks, so keep them for as long as the law requires.
Deductions the Law Allows
Employers cannot deduct whatever they like from a final settlement. Labour laws usually limit deductions to items such as salary advances, loans the employee agreed to repay, and fines or damages permitted by law, often with a cap. Each deduction on the voucher should have a document behind it: a signed advance form, a loan agreement or an official fine notice.
Final Settlement FAQ
Can I add notice pay in lieu?
Yes. Add a row to the earnings table with Add Row.
Does the timeline adjust to the years of service?
No. Edit the dates and the “years of service” label; the tick marks are decorative.
What size is it?
US Letter, 8.5 x 11 inches.
Can I show unpaid overtime?
Yes. Add it as a separate earnings line with the hours and rate.
Must the employee sign the declaration?
It is strongly recommended; give them time to review the calculation first.
Can I add a loan balance?
Yes. Add an outstanding staff loan as a deduction with the loan reference.
