At HireAthena we have the privilege of providing HR services to some of silicon valley’s highest growth startups. With that growth has come visibility into what to do and more importantly what not to do, especially around employee exits. This blog is Part 1 of our two part series about what to do when an employee is on their way out the door. Today we’re focusing on involuntary exits and how to let someone go the right way.
Leave surprises for birthday parties.
An involuntary exit should not be a shock to the employee. Performance discussions with their Manager should be consistent and ongoing, and if the employee is struggling; they should be put on a very clear performance improvement plan (PIP). Some of the biggest mistakes we see occur when managers hold off on a difficult conversation until the employee’s end of year review which typically leads to a disproportionately larger mess. Instead, invest in or train managers to have candid conversations with employees on a regular basis and equip them with the tools necessary to put the employee on a PIP. If you find that one of your managers is struggling to have a difficult conversation, please call us! We grapple with this all the time and can give them the resources they need to succeed.
Keep your conversation quick and hand it over to HR ASAP.
Begin with an overview of why the employee is being let go along with two or three reasons why, and ask them if they have questions. Answer those questions as directly as possible, but cut off the conversation if it begins to feel like a debate. Then, turn the conversation to your HR hero who will able to review their benefits, COBRA, final pay, separation agreement, and unemployment options (if you don’t want to contest unemployment).
Be confident in your decision, stick with the facts, and don’t say you’re sorry.
When you apologize; you take on responsibility for the actions of the employee you are letting go along with the liability of the situation. This can quickly snowball into a discrimination lawsuit. You may certainly wish them the best, but keep the conversation short, stick with the facts, and keep the responsibility on their side of the table.
Keep it as live as possible.
We’ve seen it all here at HireAthena; including a CEO who fired their employee over text. Do not do this. Instead, we recommend having the conversation in person.
- Will you offer a severance plan?
The nature of your severance package typically depends on two factors: how long they have been with the company, and the reason they are being let go. If they have been working for you for over a year; we recommend providing them with some severance. Either way, have a discussion with your HR Hero to ensure you have a plan in place.
- Are you prepared with Payroll?
Make sure the person running your payroll is aware so they can arrange a final payment which is different from a typical payroll. Every state has different laws regarding final pay and penalties the employer must pay if they aren’t followed.
- Will you contest unemployment?
The employee will most likely file for unemployment. The Company will receive a state unemployment form to complete. It will include reason for termination and if you agree the employee should receive weekly benefits (a percentage of their pay). Part of your employment taxes contribute to unemployment benefits for your employees. Unless your employee did something unacceptable (drugs, job abandonment, harassment) you probably won’t contest (say you don’t want them to receive) unemployment
If this blog made you realize that you need HR expertise and help; set-up some time with us here and we will get you on the right path.
Is your employee resigning instead? Stay tuned for our next blog post on voluntary exits.