Dismissing an employee is a permanent action and cannot be reversed. Make sure you’re ready to remove them from active payroll. Their information will remain in CleanCloud Payroll for compliance, taxes, and potential rehiring.
This process applies to all separations, whether the employee resigns or is terminated.
Final Deductions
Externally Managed Benefits
These will automatically apply to the dismissal payroll.
Gusto-Managed Benefits
The dismissal payroll will automatically include one full pay period’s worth of benefit deductions.
Important: Gusto cannot prorate deductions.
Example:
If an employee is dismissed on 1/15/18 and benefits continue through 2/01/18, Gusto will not capture the remaining deductions for the second half of January.
📌 Note: To apply additional deductions, run the final payroll as an off-cycle payroll and select the option to apply deductions.
Dismiss a W-2 Employee
Follow these steps to terminate a W-2 employee:
Go to Settings → Users → Manage User Accounts.
Find the employee and click Terminate via Gusto.
If the employee never started, or is a duplicate, contact us via the Help section in your CleanCloud account.
Enter the employee’s last day of work.
Choose how to issue their final paycheck.
🪄 Tip: We recommend running a Dismissal Payroll. Be sure to comply with your state’s final pay rules (e.g., payment deadlines, PTO payouts).
Click Submit & Continue.
Review the dismissal timeline and expectations.
Confirm the dismissal or schedule it for a future date.
Review the Offboarding Checklist.
Click Run Dismissal Payroll.
Dismiss a 1099 Contractor
(Currently confirming full support with LC—interim instructions below.)
What to Expect
You won’t be able to issue payments to them.
They’ll appear as inactive in your account.
Contractors will not be notified about dismissal.
Contractors can still log into Gusto to view payments and access tax documents.
Steps to Dismiss a Contractor
Go to the People section.
Search for the contractor’s name.
Or, click the filter icon, select Contractors only, then click Apply.
Click the contractor’s name.
In the Work section, scroll to the Work card and click Dismiss.
Enter the end date.
Click Save.
Optional Dismissal Details
These fields are not required but can be helpful for recordkeeping.
Let us know if the employee or contractor chose to leave voluntarily.
This won’t be reported but will be stored for your records.
Select a reason for dismissal (optional).
Add a personal email address (optional).
This is the email they'll use to log in to Gusto for tax documents.
Enter dismissal notes (optional).
Only admins with appropriate permissions can view these.
Final Confirmation Steps
Click Save & Continue.
Review the dismissal confirmation screen.
If everything looks correct, click Dismiss Employee.
Complete the Offboarding Checklist.
You can return to this later via the Offboarding tab on the employee’s profile.
🗒️ Notes:
Dismissed employees and contractors will not receive notifications from CleanCloud about their status change. They will retain access to past documents in Gusto.
If a dismissal needs to be undone, contact us through the Help section of your CleanCloud account.
🛟 Need more help?
Explore our Help Center articles for answers. Contact us for further assistance.