March
1, 2008
Keys to Managing Employee Terminations
By
Alandale Insurance Agency
One of the most stressful situations employers have to face is
dealing with employee terminations. Even when employees leave of
their own free will, there are repercussions in the workplace that
affect the departing employee, the employer and the employee's
co-workers. And when employees leave due to being fired or layoffs,
it can be even more disruptive.
When you are faced with employee terminations, it's important to
make sure you minimize any negative effects on your business and
your remaining employees. If you manage the situation carefully, you
can reduce the impact and the risk of encountering legal issues.
A proactive strategy can help. As you consider a comprehensive
employee termination strategy, it may be helpful to note that
terminations usually fall into one of three categories:
- Employer ending the employment
relationship for cause due to poor performance or behavior.
- Employee ends the employment
relationship voluntarily.
- Employer ends the employment
relationship for economic reasons unrelated to employee
performance.
In some instances, specific termination types call for certain
responses. There are also general guidelines that make sense for all
types of terminations. Here are some tips that may help:
Employer ends employment relationship for cause
- Protect yourself and your
employees: Sometimes, the wisest course of action is immediate
termination - for example, if an employee steals or is a
danger to your business and/or other employees. In this case,
immediate termination may be justified. However, make sure you
understand the law and your responsibilities fully.
- Counsel employees and document
your efforts: Some poor performers deserve a second chance.
Ensure that employees understand what is required of them, and
make sure you document warnings and counseling so that your
business is protected if you do ultimately have to terminate the
relationship.
Employee ends employment relationship voluntarily
- Make sure you understand why
employees are leaving: If you don't already have an exit
interview policy, consider implementing one. It's a great way to
find out how your business stacks up against competitors on the
benefits and compensation front. It can also be a good way to
nip management problems in the bud.
- Take advantage of
counter-offer opportunities: If a valued employee is
leaving, you may be able to keep him or her on board if you take
the time to discuss the reasons for the departure. Turnover is
expensive, and a pay raise might be far less costly than
recruiting and training a new employee.
Economic-related terminations
- Let employees know they are
valued: Layoffs are difficult, but letting employees know
they are appreciated and treating them with respect can make the
transition less challenging. If you can provide a good severance
package and help in securing another job, this will also help.
- Keep employees informed:
Reductions in your workforce affect everyone - your
management team, employees who are being let go and employees
who will remain with you. Keeping the lines of communication
open can help reduce anxiety.
All types of terminations
- Have a process in place:
Follow a set procedure so you treat all employees equally.
A checklist of termination steps may be helpful.
- Communicate effectively: It's
important for all employees to understand what is expected of
them so that you avoid misunderstandings.
- Talk to a lawyer: The
employer-employee relationship is highly regulated. If you
suspect there may be guidelines you're unsure of, consult an
attorney.
The last word
If you're an employer, chances are you will have to deal with
employee terminations at some point. They are rarely pleasant, but
you can manage the fallout by planning ahead and making sure you
have appropriate procedures in place. By taking a proactive
approach, you can minimize the effect on your workforce and protect
your business.
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