You can still process a pay with an employee status terminated.
When entering an Adjustment pay or a Timesheet with the terminated employee code, you will be prompted with a confirmation window: terminated employee, continue?
Select Yes.
This will allow you to enter the transaction and send the information to the ATO in an STP batch.
Note: There is no need to do any changes to the Employee Masterfile.
Please note that a pay that relates to a prior year may need to be entered as a Lump sum E payment. Use an allowance to process the amounts in the circumstance.