Many states have at-will employment provisions for employers and employees. This gives bosses a wide berth to fire people. For workers, there is often a wrongful termination avenue to look into. Long story short is, small business needs to know how to fire an employee properly to avoid legal entanglements.
How to Fire an Employee
Small Business Trends contacted several experts to find out the right way to get this unpleasant task done.
If you run a small business, you’re no stranger to keeping records. David Reischer, Esq. is an Employment Attorney & CEO of LegalAdvice.com. He suggests that you keep a little more than just daily sales ledgers.
“It is important to have a record of the employee’s behavior in their employee file,” he writes. “An employee file should include performance reviews, disciplinary actions, and any other notes that justify cause to terminate employment, etc.”
Remember that federal law dictates how long you keep these documents. That even includes termination records.
Have a Policy
Having a clearly defined policy statement about what happens when someone gets fired is critical. Definitions of common phrases like just cause, severances and responsibilities are some of the necessary categories. Here’s some government information that can help.
Joey Price, CEO of Jumpstart:HR, offers another helpful tip.
“Ensure your employee handbook justifies a termination. Many unemployment agencies in the US are employee-friendly. That means they will err on the side of the employee if there is no policy in your employee handbook.
Prepare the Paperwork
You will need to have all your paperwork ducks in a row. That includes all the documents for that employee and performance reviews. Make sure you have a copy of the employment contract and a copy of the employee handbook.
Matthew Ross ,Co-Founder & COO at The Slumber Yard, says there’s a legal aspect to this.
“Put together a memo to file outlining all the different incidents with the employee during their term with the company. This will come in handy in court or arbitration if it ever goes that far.”
Prepare A Good Headspace
Taking a few minutes to prepare yourself before you need to terminate an employee is a good idea. These suggestions come from Shannon Whitman at To B Consulting, Inc.
“Separate the person from the performance or behavior,” she writes. “Whether you like or dislike the employee, keep your talking points focused on the work-related issues.”
She also suggests getting rid of any potential distractions. Turn off your phone and shut down your email.
“Find a calm state – take a few minutes to meditate, listen to calming music, or whatever calms your nerves. This will enable you to conduct the termination meeting objectively and respectfully.”
Finally, she suggests you don’t forget to be compassionate.
“Do NOT tell the employee that the termination meeting is hard for you. You are not the one losing your job. You do not have to worry about what to tell your spouse or how you will make your mortgage payment.”
Have a Sit Down
Firing an employee isn’t easy. But you can’t cop out and hide behind technology. That means you need to let someone go in person. Staying focused is the best way to go. Dr Vince Repaci, Senior Coach, LOVR Atlantic suggests having the meeting at night or on a weekend. That gives the employee time to process the news.
Have a Witness
It’s good to have someone from your human resources department on hand when you fire an employee. Barring that, your lawyer is an excellent addition.
Stay On Script
Brian Cairns, Founder, ProStrategix Consulting New York, added some more tips about what to say.
“Keep your cool – expect emotion, but don’t engage or be baited into engaging,” he writes. “Stay on script. Say what you need to say. Do not elaborate. Do not try to soften the blow or water things down.”
Don’t Let Things Linger
Cairns also cautions against procrastination.
“We had a client who kept a toxic employee for too long. This person caused several strong performers to resign. So, not only did they waste his salary, they had to recruit and train several new people.”
Have Them Escorted Out
It’s good to have someone escort them out that wasn’t in the meeting. Let the employee pack up their personal items. Then collect any swipe cards and other business property before they leave. You might need to change passwords for certain computers at your small business.
If the person isn’t cooperative, you might need to change the locks too.
No Bad References
David D. Schein is the President and General Counsel Claremont Management Group, Inc:
“Post-termination, I recommend no bad references,” he writes. “The only exception here is if the employee did something illegal or dangerous. Also, if the party calling for a reference is military or law enforcement.”
He finishes up with some old school advice that still applies.
“Progressive discipline is essential in all but the most extreme cases. The old 3 Strikes You’re Out is still decent advice.”