You updated the Termination business process definition to automate the payout of plan balances when...

The time off plan must identify a time off in the Time Off for Termination Adjustment field. This field tells Workday which time off component to use when the termination process generates the adjustment that reduces the worker’s remaining plan balance to zero.

The Termination business process must contain the Adjust Time Off Balances service step after completion. When that step runs, Workday reviews eligible plans, calculates each remaining balance as of the termination date, and creates the corresponding termination adjustment using the designated time off. The adjustment can then support downstream payroll payout processing where the relevant payroll calculation or integration is configured.

Time Off Plan Balance Lower Limit controls how far below the balance a paid time off request may reduce the plan. Balance Transfer Defaults identifies destination plans for balance movement following a job change. Time Off for Balance Transfer Adjustment is used when transferring or paying out a balance during a staffing change, not during termination. The designated termination time off must permit adjustments and satisfy the applicable eligibility requirements on the effective termination date.

Study Guide reference: Absence Management Business Processes – Automating Payout of Plan Balance upon Termination .