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How Do I Pay a Deceased Employee?

By December 9, 2016November 28th, 2018Best Practices

Paying a deceased employee is a topic that comes up occasionally. Recently, I had a client inquire about the issue and then I was speaking with a colleague who works in marketing and she has had two clients pass away suddenly, leaving significant implications for their families and the companies they worked for.

My first take away is the importance of encouraging all of your employees to prepare for their own death in terms of having a plan in place to address their wishes once they pass. This could be as simple as a living will completed online or as thorough as a full estate plan drafted by an attorney.

My second take away, as an employer, is being prepared should an employee die. Who is the employee’s next of kin? Are there outstanding checks to be paid to the employee? Should taxes be withheld if the person isn’t living? What date should health insurance be terminated? Is COBRA an option for the deceased’s family members?

As you can see, there is often much confusion when an employee passes away. A recent Society of Human Resource Management (SHRM) article provides a detailed checklist of items to take into consideration when an employee dies. Having a process in place will help you manage the emotion and uncertainty that naturally accompanies an employee’s death.

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