July 28, 2023 — As your small business grows, you’ll likely have to hire new employees from time to time to keep the ball rolling. Unfortunately, it’s just as likely that you might have to let an employee go.
But don’t fret—these five simple tips will help guide you through the process and ensure things end the right way.
It’s critical to pinpoint exactly why you’re letting an employee go. Whether it’s a violation of policy, part of a layoff, poor performance, or something else, you’ll need to disclose this information to the employee clearly and concisely to avoid lengthy “debates” about why they’re being fired.
If the employee is confused about why they’re being let go, it opens up the floor to wrongful termination disputes and other potential arguments. Be ready to clarify misunderstandings, but don’t go into unnecessary details or elaborate on the “why” too much.
Schedule a Meeting
Timing is important. Letting someone go the right way requires some preparation ahead of time, but you shouldn’t schedule the meeting too far in advance. Doing so will only give the employee more time to speculate and worry, or worse, they may mistake the meeting for something routine and end up entirely blindsided by the bad news.
Never let someone go as a complete surprise. Request to meet with the individual privately, early during the workday and early in the workweek. Doing so will give them time to gather themselves and collect any personal belongings. Additionally, you should make a point to notify other employees so no one is left guessing about how things went down.
Let Them Choose How To Leave
If you can, give the employee options on how they wish to depart. Being let go can leave a person feeling helpless and inadequate, and giving them some input on the process goes a long way toward mitigating some of those feelings.
Perhaps they’d like to return to their workstation, gather their things, and say goodbye to former coworkers. Or maybe they’d like to leave quietly and return for their belongings outside of office hours instead.
Allowing the employee some say on these minor details demonstrates your commitment to ending things on good terms and reduces the likelihood of an unwanted scene or damaging posts on social media about you and your business.
Get Logistics Settled Same Day
Pay the employee everything that they’re due on or before the day you let them go. This includes wages, overtime, bonuses, commissions, and accrued vacation. Sure, it sounds like common sense, but thousands of employment lawsuits are filed each year for wage and hour violations that could have been avoided by paying the employee what they were owed upon termination.
Getting wrapped up in such an employment lawsuit, even when it’s entirely accidental, can wreak havoc on your finances and the reputation of your business. When letting someone go, be sure that they are aware of any compensation owed and that they receive it in a timely fashion.
Let’s face it—getting let go can result in a lot of painful emotions. As a business owner, do your best to handle the ordeal with as much kindness and respect as possible. Don’t forget to reiterate the good and emphasize the value that person brought to your business. Offer to give a good reference as they seek out new opportunities, if you feel it’s warranted.
Understand that this may not apply to every scenario. For example, suppose you’re letting someone go because of misconduct or inappropriate behavior. In that case, the focus should be on reiterating company policy and explaining that the employee’s actions will not be tolerated in your workplace in a calm and collected manner.
Letting someone go is part of the landscape of running a small business. Make sure you do it the right way by following this advice:
- Identify clear reasons for terminating the employee
- Keep your explanation concise; clarify misunderstandings but don’t elaborate
- Don’t surprise someone with bad news without scheduling a meeting
- Try to schedule the meeting early during the day, early in the workweek
- Let them decide how to gather their personal effects and depart
- Ensure that the employee is paid all compensation on or before the day they’re let go.
- Be as kind, compassionate, and respectful as possible