Exception: Business Validation Error: This employee cannot be deleted because it is used in unbilled charges.
I've reviewed your profile and found that you've commented on a different post. As stated on the error, the employee profile you're trying to delete or make inactive is associated to unbilled charges (expense, checks, bills, or time).
I'll base the steps that I will provide on the screenshot you've attached on the different thread/post.
Open the Unbilled Charges report.
Click on the Billable Expense Charge transaction type.
Click the Bill hyperlink.
Remove the check mark in the BILLABLE column.
Click Save and select Yes to confirm the action.
Do this to other billable expense charges. Afterwards, you can already delete or make the employee inactive.
We'll be right here if you have additional queries about the steps above.