Published On: July 13th, 2022 / Last Updated: July 5th, 2022 / 3.3 min read /

Full and Final settlement (FnF)

FnF full form stands for Full and Final Settlement. Full and final settlement is the process of calculating all the dues payable to an employee, whoever resigns, retires, or is terminated by the company. The dues have to be paid till the last working day of the employee. Generally, the organization’s HR department is responsible for this.

The full and final settlement consists of clearances from various departments like IT, finance, HR, and admin. Exit interviews and feedback surveys are also a part of the FnF settlement in some cases. These reviews help the organization in evaluating its strengths and weaknesses.

The calculation of the final reimbursement amount is the toughest task, as you need to take care of multiple components. We have listed the major components, which result in making the Full and Final statement.

Unpaid Salary
Unpaid salary refers to the total number of days for which an employee has worked, after submitting the resignation. It is usually the time duration between an employee’s resignation date and the last working day. Sometimes, the unpaid salary may be also 2 months’ salary; as some companies don’t pay the salary once the employee has put in his resignation papers; they pay all the pending salary in his final settlement.

Non-Availed Leaves
Normally, the employee has annual leave which is accrued every month. If the employee has an annual leave balance; then they are subjected to encashment.

Gratuity is a monetary payment eligible to an expatriate employee as a lump sum at the end of his tenure, provided that the period of service exceeds one year. The basis amount used to calculate is the employee’s last drawn basic salary.

Airfare Reimbursements
As per the company policy, they define air ticket benefits to the employees either annually or biennially. If the employee is leaving the company, then pro-rate days-based air ticket entitlement is paid to the employee.

Deductions may be of many types some are traffic fines or loan deductions which an employee has taken during his employment cycle.

Pension is provided to eligible Emiratis and other GCC nationals working in the UAE. The pension contribution is paid both by the employee and also by the company. Employee part of his contribution will also be deducted from his final settlement.

Notice Period Payment
In case of immediate termination from the company, the company may need to pay the notice period salary to the employees as mentioned in the contract.

Return of Assets and Company Vehicle
Some of the companies provide laptops, Mobile phones and other assets for the employees to carry out their day-to-day work for the company. Even some company they provide vehicles like cars, bikes etc. to the employee for their day-to-day activities. During the FnF process, HR should make sure the assets of the company are recovered.

With HR Chronicle, there is no need to worry about these manual calculations and spend your limited time on the same.  If you want to align your HR and Payroll process and want to know how to configure all the formula’s as per your policy or as per the GCC labour law. We are here to provide complete guidelines on the same. HR Chronicle is the leading HR and Payroll Management software in the Middle East region. It is considered the best payroll software across the GCC. Get peace of mind and focus on running your business.

HR Chronicle is designed as per GCC Labor law and policies. No manual calculations, no paperwork, no last-minute confusion.  With HR Chronicle manage your company’s HR and payroll processes efficiently.

Have a question, want to get started on your HR automation journey. Please contact our team for any inquiries on pricing and licensing.  We will be glad to assist you.  You can also visit us at  or email us at: You can also call us +971 4 3383775 or Whatsapp +971 55 650 6260.

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