CEO gives employee pink slipTerminating employment, no matter the reason, is usually not fun for anyone. However, if poorly executed, it has the opportunity to be an extraordinarily unpleasant situation that is damaging to all parties involved. With a bit of finesse and a good plan, a company can relieve an employee of their post gracefully.

Being in the middle of this decision may cloud our judgment and make us want to rip the task away like the proverbial Band-Aid just to get it over with, but as you know, a good business reputation is very important. We spoke to a group of HR professionals with deep ties in the field to garner some suggestions on how to best manage a termination with as much discretion and professionalism as possible.

Nailing Down the Process

An important bit of planning, pre-termination, is making sure that you are adhering 100% to company policy during the process. Termination can be a complicated endeavor depending on the type of business you’re in and the amount of time the employee in question has been with you. Kimberly Carroll, a principal with IA, brings over fifteen years of experience in finance, accounting, HR business analysis, HR/payroll operations and product management for complex multi-national entities. Carroll feels that a solid plan is the best way to handle termination smoothly.

Kimberly_Carroll_sqUnderstanding the process and rules around termination, either voluntary or involuntary is the most critical step you can take to ensure a smooth transition. You can plan ahead by ensuring the policy is up to date and visible to managers and employees, preferably a checklist of tasks for both. Make sure that transition of duties is documented and communicated. You also need to touch base with downstream partners, i.e. IT, Payroll, Security, to ensure all necessary steps are followed.

Matthew Stollak, Associate Professor of Business Administration at Saint Norbert College, feels that reeling in all the information associated with the employee in question is a good way to deal with the termination effectively.

Matthew StollakCompanies may wish to manage the accounts for which the departing employee has access, such as company credit cards, or network logins. Those accounts should be deactivated quickly. Detailed records of office inventory should be kept so that it can be easily recovered upon the employee’s departure. Policies such as non-compete agreements should be kept up-to-date. Proper documentation should be kept, particularly in the case of termination, so that if an employee is fired for just cause, the organization can be protected against litigation by showing adherence to a progressive discipline policy.

There are of course some very practical considerations to take into account during the planning stage. Richard T. Rossignol, the founder and President of Expert HR Consulting, has over 20 years of executive level HR expertise, and in his opinion some simple adjustments like time of day and week make a big difference.

Richard RossignolA company will want make sure they set the date, get the employee’s paycheck, severance document, retrieve all the company property, cobra documents and script for the meeting with the employee. Do it early in the day, try to shoot for middle of the week, not the last meeting of the day on a Friday.

Spreading the News

Breaking the unfortunate news to the employee him or herself is tricky enough, but there is also the task of informing the rest of the staff and clients that dealt directly with that employee to contend with. Jon Decoteau, SHRM Divisional Director, has more than 25 years of human resources experience- holding leadership roles at several iconic companies including eBay, The Coca-Cola Company, Motorola, Nissan Motor Corporation and General Dynamics. Decoteau feels that often times, you can express your concerns directly to the outgoing employee and seek their assistance in the matter.

Jon DecoteauOften it is best to have a discussion between the supervisor and the leaving employee about how best to handle situation. If the leaving employee has relationships with key clients it is best to have them have a conversation with those clients along with the sales lead to ensure a smooth transition and hand off. In the cases of close knit work teams (often common in financial and IT industries) the employee and manager should discuss and agree the best way to communicate the resulting work needs and announce to the remaining employees. Have sales lead conversations and work toward an easy transition and smooth hand off.

Tim Sackett, President of HRU Technical Resources, has 20 years of HR and Recruiting background with Fortune 500 companies, and he says that beating the rumor mill in a termination situation is a great tactic.

Tim SackettI always like to have a draft of a communication done prior to the employee leaving that can be immediately released to employees, to get ahead of the wildfire of gossip. For some clients it's critical to get out in front of them immediately, if not before, a key employee to their account is let go.

Making a Transition

After you’ve made the termination, and informed all the relevant parties, you may ask yourself- How do I keep the engine running? Especially if this particular employee was a key one. Again, like so much of sage business counsel, it comes down to planning. Decoteau has developed three critical steps of his own that outline a smooth transition. 

  1. Knowledge Transfer: Gather the information the employee has gain either for your own use or for distribution to the team. This is often difficult for lean companies, but it is one of the most important parts of the transition process. Work with the leaving employee to make sure they put all of their files into shared files and make sure nothing is lost.
  2. Out processing: A lot of companies get stuck here and forget about the two other important elements. This focuses on pure logistical matters such as keys, company credit cards, computers etc.
  3. Exit interview: This is an important opportunity to have a discussion with the employee that is leaving and dig out extra information that may ease the transition. Really progressive companies will take a subset of the top group of employees that leave (The top 5 or 10%) and do an additional interview 6 months or a year later. Sometimes people go somewhere else and learn that the grass is not always greener. It is a great opportunity to re-recruit and continue the relationship. While some companies have strict policies about not rehiring, better companies have people leave and return sometimes multiple times.

Stollak echoes a few of Decoteau’s suggestions. Stollak feels that if you build your company’s knowledge base from the beginning, training replacements or having existing employees take over will be easier.

Developing a knowledge retention program will make a transition much easier. A traditional exit interview would help the firm capture suggestions on how to improve the business based on the years of experience the employee has been with the organization as well. Similarly, one could have employees create a video explaining how to perform a difficult task. Phased retirement, if it is an option, also can be used to help keep access to a long-time valued employee.

Sackett would offer a word of caution about the transitional period, and reinforce the importance of proper communication.

Don't ever underestimate how the client will feel about you letting an employee go that is close to their company. I have had clients who have come out and said if you let so-and-so go, we will no longer do business with you! While I won't let a client hold me hostage, we had to manage through this, before moving forward.

Tidy Terminations

There are many factors to take into account during a termination, whether it is voluntary or involuntary. Ironing out your company’s policy to make sure you are respecting everyone’s rights, giving all concerned parties the heads up about the termination, and planning for a smooth transition are all strategies to help make an inherently unpleasant situation manageable. When you need a hand planning for administrative issues, like the ones discussed here, contact Simas & Associates today!