Dealing with employee terminations is one of the most challenging employee situations that managers have to deal with is discharging an employee based on cause or performance. No matter how much experience you may have, the risk of elevated tempers, stress levels, and emotions can become very escalated. There is also potential risk of lawsuits and legal fees if terminations are handled incorrectly. Using guidelines outlined in this article — including being consistent, keeping everything job related, and using professional communication and confrontation techniques — will help you minimize challenges and risks associated with employee terminations.
Discharge for Cause – A discharge for cause may result from a blatant, direct violation of a company policy such as theft, fighting, time card fraud, harassment, insubordination, etc.
Discharge for Performance – A discharge for performance is based on an employee’s inability to meet defined performance expectations, goals, metrics and/or Key Performance Indicators (KPIs).
In either situation, knowing when to terminate and when to conduct a termination meeting requires defined steps:
- Clearly communicate employee expectations;
- Track, document and communicate in a timely manner performance and policy violations;
- Create and consistently follow corrective action and termination guidelines;
- Be prepared for the termination meeting….and Be Respectful!
It is very important to have a well-written employee handbook that clearly documents company expectations regarding important policies, workplace rules, and conduct. From there, managers need to further inform employees of job requirements and expectations through written job descriptions, one-on-one meetings, and job training. Managers need to establish clear, written goals for each employee, map out an initial job training plan, and communicate the appropriate method of giving ongoing feedback. The ability to coach effectively and to give immediate and clear feedback, whether above or below expectations, is key to managing performance expectations.
Track And Document Performance
A well planned performance management system helps to establish a method to track and document performance expectations, including coaching and giving feedback. Some systems clearly track and measure, such as a phone/dialer tracking system that shows the number of phone calls and time per call for customer service staff. Sales staff may have sales quota goals to meet every month or quarter. The key is to have some means of comparing and measuring expected performance to actual results and behaviors. Positions where there are no clear, tangible
metrics may use competencies and goals to define expectations, then compare performance against results and behaviors.
Documenting performance can be formal or informal and is primarily done by the manager.
Informal documentation may include a manager’s notes after a one-on-one meeting or training, a follow-up email to an employee with a recap from a feedback session, or even notes in a calendar. Both formal and informal documentation help to defend discharge decisions, appeal unreasonable or untruthful unemployment claims, and provide information to help you make the right choice, at the right time.
Corrective Action & Termination Guidelines
Depending on the severity of an employee’s actions, or poor ongoing performance levels, corrective action such as discipline or termination may be necessary. This is when established guidelines come into play so management, along with Human Resources, can make informed, best practice decisions.
Corrective action and termination guidelines are for management and human resources staff to help to ensure consistency, fairness and legal compliance. These guidelines would not be defined in your employee handbook but would be used as part of a leader guide or toolkit. Corrective action guidelines generally include the following elements:
Progressive coaching steps managers take when performance is out of line;
- A list of situations that may result in immediate termination such as theft, fighting, drug/alcohol use at work, etc., although take some caution in immediate, “on-the-spot” dismissals;
- Documentation of discharge requirements and process, such as a termination checklist (see below); and
A list of situations that may result in immediate termination such as theft, fighting, drug/alcohol use at work, etc., although take some caution in immediate, “on-the-spot” dismissals;
- Clear understanding of the termination meeting including script review, exit interview, final paycheck and benefit procedures.
Before a final decision is made, make sure to review all documentation and work with Human Resources to address the following important questions:
Was A Thorough Investigation Conducted, If/Where Applicable?
- Has all relevant past and current documentation been gathered and reviewed?
- How has the company handled this type of situation in the past? Be consistent!
- Is the affected employee in a protected class? If yes, make sure there is no discrimination tied to the termination decision.
- Could this termination be a violation of any state or federal laws? Work with Human Resources, or, if necessary, work with your company attorney.
- How will we handle the termination meeting? When? Who?
Be Prepared For The Termination Meeting And Keep It Respectful!
Once the final decision has been made to terminate an employee, make plans with the appropriate management and human resource staff member(s) for a date & time and private meeting location. It is advised to go over a script for the meeting in advance to prepare for all potential outcomes. Make sure all termination items are addressed such as final paycheck, protection of systems/data and equipment, list of items you will need from the employee, and if applicable, a written separation agreement. Separation agreements are usually only needed when severance pay is being given or as a technique in preventing a volatile individual from presenting a future lawsuit.
The termination meeting should be short, to the point, and direct, but should also be respectful. In a calm voice, simply tell the employee the reason for the termination and that today will be his/her last day. Provide just enough information that the employee will understand the essence of the decision, and in most cases this should not come as a surprise. Avoid the temptation to get defensive, apologize, or react with negative comments. Allow the employee to vent if needed, yet control the discussion by leading back to helping them move on to their next job opportunity. A useful technique after telling them “today is your last day” is to immediately talk about their final paycheck, how benefits will be handled, and what the company needs back from them (e.g., badge, keys, laptop, etc.).
Throughout the meeting, treat the employee with respect and dignity; it is ok to be empathic or understanding, but stay focused on the intent of the meeting and make sure they understand the decision is final. Conducting a termination for cause or performance, while stressful and sensitive, can be done professionally without escalating into a negative situation.