How to Say Goodbye to an Employee

2009 | Apr 8 in Guest Contributor , Home Page News , Management , Leadership

By Erin Duckhorn,

By Nina L. Kaufman, Esq.

On the list of "business responsibilities that we enjoy," letting an employee go ranks right down there with doing your taxes and appearing for a deposition. Employers have difficulty terminating employees for several reasons. There's the discomfort that accompanies having to deal face-on with conflict. There's the guilt that comes from "rejection" of the employee, especially if the employee had extenuating circumstances for poor performance. There's the uneasiness that comes from lack of experience in firing employees and the concern about doing it properly to avoid legal landmines. All of it makes small business owners want to reach for the 3 Ts: Tylenol, Tums, and tequila.

Whether you're firing for bad deeds (substance abuse on the job, theft, harassment) or just unfortunate situations (can't do the job, doesn't get along with co-workers, downsizing) you need to have the details in place before you have the "termination conversation." The key to success: document, document, document. Here are 5 steps you can follow to ensure you navigate employee firings successfully.

  1. Help the employee avoid termination altogether. After all, the goal should be to solve a problem, not just to escape a difficult situation. Sounds basic, but many small business owners get so wrapped up in the other aspects of their company that they forget to nurture and guide their employees. If you have questions about how best to do that, see last month's article, "How to Ensure Employee Effectiveness." If a problem starts to brew, nip it in the bud quickly. Collaborate with the employee to set out clear goals, performance expectations, and responsibilities. Consider providing training or mentoring so the employee has a reasonable opportunity for success.
  2. Monitor milestones. You want to give an employee a chance to perform up to par . . . but set deadlines for achievement. If an employee can't (or won't) make the changes you agreed upon in Step 1, it's time to let him/her go. You have bigger issues — like the productivity of your company and the morale of the rest of your (performing) workforce to consider.
  3. Coordinate with HR and legal counsel. Given the twenty-some-odd federal discrimination laws, and the myriad of state laws affecting employees, you'll need and want proof that the firing has a reasonable business justification . . . and that you handled the process in an unbiased manner. This is especially important if you're firing employees in connection with a "reduction in force," or overall downsizing of your company. Employee lawsuits are on the rise with the increased difficulty in finding a job elsewhere at the same pay with the same benefits. For example, it may seem a good idea to get rid of senior staff (because their salaries are highest), but that could run you afoul of age discrimination statutes. Get the tips and feedback you need from professional advisors to put the right procedures in place.
  4. Prepare in advance for the "termination conversation." Choose a private place in the office (e.g., a conference room away from prying eyes). Selecting a third party to be present, such as HR staff, legal counsel, or other senior manager who can be entrusted to keep matters confidential. Know what you'll say in advance so that you're not tempted to backpedal or soften the blow because of the awkwardness of the situation. Consider role-playing exercises or rehearsing in advance.
  5. Address "what happens next." Employees will have a host of questions concerning issues like final pay, continuation of health coverage, and outplacement. Determine a deadline for the return of company cars, PDAs, cellphones, etc. Once fired, don't let the employee linger; have someone escort the employee to clear out personal effects leave the premises. This also helps prevent the removal of company property (intentionally or otherwise).

Let's face it: having to fire employees stinks. It's one of the "tough love" lessons of small business ownership: awful to go through, but if you handle it successfully, the rewards on the other side — leadership, a culture of respect, accountability and trust — are priceless.

Want more information on the legal landmines that employers will want to avoid? Visit our website, www.GreatBusinessLawResources.com/reasonsemployersgetsued.htm to get your free copy of our special report, Top 10 Reasons Employers Get Sued.

© 2009 Nina L. Kaufman, Esq. Nina L. Kaufman, Esq. is an award-winning attorney, speaker, and Entrepreneur Magazine online columnist and blogger. Under her Ask The Business Lawyer(SM) umbrella, she reaches thousands of entrepreneurs and small business owners with her legal services, professional speaking, information products, and Lex Appeal weekly ezine. For more information, visit www.AskTheBusinessLawyer.com.


  1. .Louise C. says:

    We had to let several sales people go a couple months back and even though it was the right thing for the business (and helped keep us afloat) I still feel pained about it.It really just stinks to have to let good people go.

    On the other side of the coin, the reduction in employees forced us to reconsider our organizational structure and helped us get lean in a way that's actually helped us streamline and become more efficient.

    Submitted Apr 8, 2009 7:33 AM

  2. .Jason R. says:

    Layoffs are becoming a common occurrence these days as businesses struggle to survive and make a profit. I think the hardest part of being a business owner/manager is firing someone. Yes, the legal aspects are daunting but that's not what I mean. It's one thing to fire someone for cause - theft, performance, unable to get along with others, etc. But, it's quite another to fire someone because the business needs to survive. It may need to be done to stay in business and keep other employees from suffering the same fate but that doesn't make the task any easier. It's also hard on other employees. Someone you have worked with is leaving through no cause of their own.  That approaches the emotional state of a death in the family. Most people understand and accept firing for a cause. Escorting that person under a watchful eye from the premises is needed.  Layoffs pose different issues. Would it be better for all concerned to allow that person to say good bye and leave with some dignity?  I'd be interested in your opinion.

    Submitted Apr 8, 2009 7:59 AM

  3. .Tony R. says:

    I found that I always could not sleep the night before terminating a person...for ANY reason. My stomach was in knots and my back hurt. Then I received this great piece of advice: if termination is necessary, it is the best thing for both sides. If a person is not working out, for whatever reason, they are in the wrong place and can never realize their true potential. In many people's mind, that is why we are all here.

    Submitted Apr 9, 2009 10:48 AM

  4. .Vi W. says:

    I'm with you on this Tony. Firing and employee is one of my least favorite activities.

    The first time I fired an employee, I anguished over it for 2 weeks AFTER I knew that I had to fire him. When I called him into my office to let him go, his response was, "I know, I have been looking for other jobs." I really wished I had let him go sooner.

    Nina, thanks for laying it on the line so clearly. Most of us who have been in business for a while have been burned by an employee who knew the rules of termination when we don't. I'm glad that you are helping people learn these rules from you experience, rather than the school of hard knocks.

    Vi Wickam
    On-Site Computer Solutions / Principal Web Solutions
    http://www.424help.com / http://www.principalwebsolutions.com

    Submitted Apr 11, 2009 5:00 AM

  5. .madilyn w. says:

    i know the feeling i just got let go with a company i just work for and am an employer and its very stressfull cause i had a bad exp. and i have had jobs where they let me go and it went smooth so dont let it send u to the grave earth still goes round it doesnt stop

    Submitted Apr 13, 2009 9:30 AM

  6. .Chris P. says:

    For the last several years I have been discussing in my interview process that we consider our employees to be the most important aspect of delivering the highest quality of service that is our standard.  Further, I emphasize that we only have room for top performers and those that are consistently demonstrating all the behaviors that will eventually lead them to become top performers and a productive, contributing member of our team.  I explain that it may become apparent at some point that we just don't have a good fit here.  This company and this industry is not for everyone.  You may arrive at that conclusion on your own and I want you to know that there's no hard feelings if you choose to walk away.  My least favorite activity is breaking it to someone that they aren't working out but I owe it to everyone else on the team to do just that if it should become necessary.

    I find that this goes a long way, especially since we counsel and coach (and document) short comings along the way.  Generally, there is no great surprise at separation.  We are a three strike company unless it is a gross violation of our Code of Conduct.

    Submitted Sep 27, 2010 1:32 PM

  7. .Scott B. says:

    Someone told me recently. Hire slowly, Fire Fast

    Submitted Jul 3, 2012 7:28 PM

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