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How to Fire an Employee the Right Way

how to fire an employee

In his reality show, President Trump would terminate employees with two simple words, “You’re Fired”. In the real world, it’s not quite that easy. Whether you are terminating a worker for bad behaviour or handing out pink slips due to budget cuts, the process can be painful. So let’s dig a bit deeper and take a look at how to fire an employee, the right way.

Why are you firing them anyway?

Before we focus how to fire an employee, let’s take a look at the why you are dismissing them in the first place. There are a lot of valid reasons to terminate an employee. Maybe they have been performing poorly as of late. Or perhaps they are a bad influence on the other staff, causing a decrease in overall productivity. It could be that they just aren’t up to the job, despite what their resume said.

But, did you ever talk to the employee about these issues? Did you create a report for each incident? If not, you may be setting yourself up for a wrongful termination lawsuit. So be sure that you not only document each of these instances but also address them with the worker. It’s important for them to realize that their performance, behavior, attitude, etc. is not acceptable. And be clear about the consequences if their actions continue. This will give the employee an opportunity to change course and also understand that this could lead to their termination.

Prepare for the event

Firing someone can be an emotional event, for both the employee and the employer. So it’s best to go in prepared. Gather all of the basic information to answer their likely questions, for example:

  • Their official termination date
  • When their health benefits will end
  • If they will receive a final paycheck.

Your company’s employee handbook is a great place to find all of these answers. Next, you’ll want to consider what you are going to say. Again, emotions may run high. And sticking to a short script will help keep you calm and collected during the meeting.

The Deed

Now it’s time to fire the employee. But remember you know this is coming and they, likely, do not. So be prepared for a whole array of reactions, from anger to sadness. You should allow the employee to vent and try to listen more than you speak. They may even say some hurtful things that they don’t truly mean. But don’t engage with them on these items as it could draw you into a shouting match, which is never productive.

Empathy is key in this situation. After all, you may feel the same way if you were on the other side of the conversation. At the conclusion, it is usually best to ask the former worker to gather their things and leave the premise immediately. After all, he or she could still be in an excited mental state. And you don’t want them to cause damage to your property or even other staff members.

The After Effects

Other Staff

Even though the former employee is out the door, the fallout from what just happened is only beginning. Rumors will be flying around the workplace. The staff will be whispering about everything from why the worker was terminated to who will be fired next. This is a great time for an employee meeting, where you can explain why their colleague was let go. This will help stop the rumor mill and allow everyone to calm down. The terminated worker will give your employees his or her side of the story after their shift ends. But since you already explained why he or she was let go, it’s less likely that their complaints will resonate with your staff.

Protect your business’s reputation

This newly fired employee may take to social media to trash your company. And you don’t want to develop a reputation for being a bad place to work. So it’s important to be vigilant over the next few weeks. Watch your Facebook, Twitter and other social accounts for misguided or incorrect comments from the former worker. Don’t sink to their level by making things personal. But instead make positive statements and quickly correct any false posts with solid, verifiable facts about your business.

Unemployment Compensation and other boring things…

A lot of small business owners believe that their unemployment tax rate will sky rocket after a termination. While it’s true that the rate may go up, the actual increase might be less than you think. Check out this article from Chron.com, for a better understanding on how this whole process works.

One last thing to remember. In Pennsylvania, and many other States, any business that offers health insurance coverage must send a COBRA offer letter to discharged employees. This is true even for small companies, with less than 20 employees. Even if you know the person has no intention of keeping your medical plan, it’s still best to send the offer. Preparing the document only takes a couple of minutes and it will protect your company from potential government fines for non compliance.

In conclusion

While firing an employee can be tough, following the steps we’ve laid out here will help make the process just a little bit easier. And if you’re persistent in addressing issues with your workers early, many of them will correct their actions. Hence you won’t need to fire as many people and your business will run more smoothly. But, if you have to give someone their walking papers, don’t be afraid to pull the trigger. After all, you now know how to fire an employee the right way. And remember keeping a bad apple around your other workers could end up costing you much more than a bump in your unemployment tax rate. Happy Firing!

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