When It's Time to Fire...

A topic that frequently goes undiscussed in management courses and sometimes even management training is firing or the more contemporary term, "involuntary termination." :-) I was just discussing this topic with a peer of mine, and specifically, the differences between the urgency of small firms and startups terminating non-performing employees based sometimes on pure financial survival vs larger firms that have the financial luxury of taking more time. Larger firms tend to have more lengthy processes primarily to protect themselves from potential lawsuits.

It probably goes without saying but if a firm has good a thorough job of recruiting the right talent, provided effective coaching, provided substantial tangible and intangible rewards that involuntary terminations should be an infrequent occurrence. Ensure that you have provided the employee the appropriate coaching and verbal and documented/written warnings before you decide to terminate the employee.

Here are some tips when the time has arrived to terminate an employee.

1) Documentation: Ensure you have complete documentation of coaching and written warnings. This can help prepare you/your firm in the unfortunate event that legal action is taken.

2) Engagement: Engage your manager, which hopefully has already been done, in addition to your human resources department. If you are a startup or small business, include your exec team and your investors if the person is in a key role.

3) Severance: Providing a severance package, even if minimal, can minimize the stress for the employee and resulting anger toward you and your firm. A traditional model at large firms is 1 week of salary for every year of service for non-management staff and 2 weeks of salary for management staff. In return for the severance package many firms will require the terminated employee to sign a non-compete and non-disclosure agreement. COBRA payments should also be explained if possible. We are not going to get into that topic here.

4) Brevity: One of the mistakes I have seen rookie managers make is dragging out the termination conversation with the employee being terminated. Frequently, employees will try to dissuade the manager from carrying-out the termination. Having rookie managers terminate employees without preliminary coaching or other seasoned managers at the termination meeting is a recipe for disaster. A good rule of thumb is that the termination meeting should take no more than 10 minutes.

5) Rationale: If an effective job of coaching and warnings have been provided the actual termination and rationale should NOT be a significant surprise. The amount of rationale (detail) that is provided is really up to the employer. The employee-focused method is to provide a summary of reasons, dates etc.. The legal-focused method is to provide minimal detail and simply focus on a lack of performance. Obviously, sometimes situations such as violence in the workplace and stealing more often than not result in immediate termination.

6) Venue: A frequently critical element in the termination is the venue for the actual termination meeting. I hope it goes without saying that termination meetings should be done either face-to-face or at worst case through a phone call. Terminations should not occur by email (you can talk to your legal counsel about why). The venue should be near an exit to the building and distant from a public place and other employees. In the event there is an outburst of emotion, which I have experienced first-hand, you want to reduce/eliminate negative reactions from other employees.

7) Company Equipment/Access: I was literally coaching an entrepreneur this afternoon about the termination of a software engineer for his startup. In addition to the obvious return of items such as: company laptop, security badge, smartphone etc. it is critical to think of all of the damage the terminated employee could do to the firm. Eventhough the software engineer did not have any company equipment besides his computer he had access to the code to the company's software. In this case, we discussed terminating the software engineer's access to GitHub, Slack and email.

8) Communication: In an effort to protect the company from any potential resulting legal action it is critical that as little information is shared with anyone not involved in the termination process. A simple statement such as, "Robert is seeking alternate employement opportunities" or "Annie decided to take her career on a different path" is sufficient.

Terminating employees is one of the worst elements of the role of manager and should be a last resort. As mentioned previously, if you are spending enough time effectively recruiting, coaching and providing sufficient tangible and intangible rewards your company turnover should be minimal.

If you would like any insights into managing the workforce at startups feel free to reach-out to me at: [email protected]

Thanks-

G