As a compliance company specializing in human resource management, employee termination problems are a weekly issue – at a minimum. Like many issues in HR, the rules can be very complex and often don’t even follow common sense.
To start, let’s clarify that the concept of “termination of employment” is not always a bad thing. Termination is a generic term for an employee leaving your business. The reason can be voluntary or involuntary and the approach to each situation is different.
Voluntary termination simply means the employee is quitting. Your first job is to determine why. If they are leaving to move away, to be a stay-at-home parent or a host of other life decisions your actions are minimal. You do want to have a discussion with them to uncover any negative feelings that may contribute to them leaving. Some of those can be rectified, if you want to. At a minimum, you may learn something about your business. Action steps related to voluntary terminations are as follows:
- Discuss the reasons the employee is leaving (again, correct if you can or want to)
- Have the employee complete and sign a Termination Report. This should simply include their last day on the job and a statement of why they are leaving (optional).
- Inform the employee about final pay and benefits. You must understand your financial obligations to the employee. These include when they will receive their final pay, how benefits are handled (paying out vacation, PTO, etc), all of which vary by state law.
- Inform the employee about voluntary termination policy as stated in your employee manual. Even though voluntary, a statement of your expectations/policies regarding turning in keys, manuals, uniforms and the like is a great idea. Also include the settlement of any debts to the practice, also governed by individual state law.
- Consider any “notice” provided by the employee. You can require notice for voluntary termination but sometimes the employee will no longer have their heart or brain in the game. In those cases, you may want to consider paying them for their notice and sending them on their way.
Involuntary terminations are usually far more complicated. The decision to fire an employee must start with the decision to do what is best for your business and your other employees. Never keep a subpar, or problematic employee because you do not want to face the repercussions of a nasty firing experience or because you are worried about unemployment benefits. Toxic employees are just that – toxic to your business and the rest of your staff. Unless related to a legal or extreme adverse action by the employee, most involuntary terminations should be proceeded by progressive counseling. Almost everyone should get a second chance but there are exceptions. Abuse, lies, theft, destruction of property – there are situations that justify immediate termination. Include a list of those potential reasons in your employee manual. Do not rely entirely on the concepts of “at-will” or “within the probationary period” – documented, progressive counseling is usually the only way to defend most any involuntary termination. Always follow your policies as detailed in your employee manual. Be very careful to completely avoid any actions that could be considered to be discrimination.
Progressive counseling is “just the facts”.
- Investigate everything and gather all the facts. Make sure you know what is happening inside your business. You do not want to go into an exit interview and find the reason the employee’s performance suffered was due to feelings of discrimination or harassment. Do not allow yourself to walk into a room full of hornets. Make sure any such potential issues are uncovered and dealt with. Bias, discrimination, personal or religious beliefs or any issues defined by Federal or State law as discrimination have no place here. Defending a wrongful termination lawsuit is ugly and costly.
- Use a Progressive Counseling form. Be specific on what is not working and what must change. The counseling form should include a definitive statement of what will happen if the problems are not cured and within what reasonable, specified timeframe. Make it clear that unless the employee has not adequately eliminated the problematic issues, termination is an option.
- Review the employee at the designated time. Their improvements have either saved their job or it is time to terminate employment. Be careful “extending” the terms. This is rarely justified. If done properly, an employee should never be surprised if they are fired.
- Complete a Termination Report. Once progressive discipline is over and there is no turning back, the less written down the better. Make a short statement explaining why the employee is being terminated. If done correctly, the best-documented reason is “Failure to eliminate problems as agreed to in prior counseling.”
- BEFORE you actually terminate the employee, erase all usernames, key and alarm codes and passwords from your system.
- Pay due at termination, including payment of accrued benefits, is typically defined by state law. Whatever the law says, the best advice is to have a check ready to pay the employee everything you owe them.
- Call the employee in privately and tell them they are being terminated. Again, if a system of progressive counseling has been used, the employee should not be surprised. Some employees will still want to argue or ask for reconsideration. Do NOT go there. Simply state “We feel you would be better off working for someone else”. The more you say during an involuntary termination, the more those words can be used against you.
- Escort the employee to their workstation for their personal belongings and escort them out of the building. Make sure someone stays with them during the entire process.
While this process may seem cold, the process of involuntary termination must be completely devoid of emotion. You have already made the decision, execute the decision. Remaining calm and logical will actually make the process easier for both parties.
During any termination, voluntary or involuntary, common questions arise. Your correct answers are very important.
- Can we talk about this? Can I get another chance?
“No – we have made our decision”. Next question
- Am I eligible for rehire?
In the case of voluntary terminations, you can give them an honest answer but the best answer is “We consider all decisions for rehire on a case-by-case basis”. Again, sounds cold but you are avoiding potential discrimination issues. For great employees, you could always add “You know you’ve been a valuable part of our practice and that certainly would be considered if you ever came back to us”. For involuntary terminations, the answer is easy – No. Next question.
- Am I eligible for unemployment?
Easy – divert. “That can only be determined by our state law.” In some states you are required to present their unemployment options to them – YOU MUST KNOW YOUR STATE LAW.
- Should I appeal a request from the state for unemployment?
That is always your decision. For gross misconduct, almost always. For others, it typically depends on if you have a documented trail of progressive counseling leading to the termination. Without that, you will likely lose the appeal anyway.
Severing relationships, even with less-than-optimal employees is never fun. Unfortunately, it always has been and will always continue to be an essential function of running a business. When done properly the business is always better for it.