Whether you are the person tasked with delivering the bad news or the employee who is being let go, the termination process is difficult, painful and emotionally treacherous. Sometimes a happy marriage gradually turns sour, or it may have had red flags from the very first date, but bonds have still been formed and weathering the breakup takes skill. Initiating and successfully executing a termination involves handling anger, guilt, regret, bewilderment and fear for the future—on both sides of the equation. Good business leaders had best master this process.
Many factors make it hard to fire—worries about legal issues, concern about the effect on remaining employees, inability to easily find a replacement or personal repercussions, especially in a family business or in a small company that feels like a family. Often the decision to let someone go is the last resort when performance coaching and constructive feedback hasn’t worked. Experts advise that if an employer behaves ethically, legally and with civility and compassion, they can feel confident in firing the employee who ought to be fired.
“In today’s world, and especially in the state of California, there are not a lot of people who can get away with yelling ‘You’re fired!’ on the spot,” says Chuck McPherson, founding partner of the business management consulting firm Leap Solutions. “There is a process that moves an individual through the chain of events.”
McPherson lists the ways a person can lose their job. They can decide to say “I quit” and tender their resignation. They can be laid off, due to downsizing or any number of other reasons. They can lose their job through misconduct, for example, theft (including falsifying a timecard) or violence, like fighting. This kind of egregious conduct is usually grounds for immediate termination. But even in a conduct-based firing, there are still steps that must be taken: investigating and documenting the offense and then arranging the meeting in which a termination takes place based on the evidence.
The same process happens with a termination based on the employee’s performance. First comes a verbal warning, then a written warning, and then a probationary period along with a plan to “course correct.” A Performance Improvement Plan (PIP) is a tool designed to facilitate constructive discussion between a staff member and his or her supervisor and to clarify what needs to be corrected or improved. A PIP enables the manager to set goals, establish measures, conduct review sessions and chart progress. If, after these steps have been taken without improvement, termination of the employee follows.
According to McPherson, however, there are actions to take at the point of hiring that might prevent that painful outcome. “Setting clear expectations for a new hire begins with a clean and clear job description. If that document doesn’t exist, it should be created. Or, write down something that makes clear what the new employee is accountable for. The next piece is communication. We often see that leaders don’t have those crucial coaching conversations; they avoid them, get frustrated and want to move to termination. We say, ‘Hey, wait a minute. When was the last time you talked to the individual?’” It is the job of leaders to help their people be successful, not just point out what they are doing wrong.
Do people wait too long to fire? “Always,” says McPherson. “Who in their right mind wants to fire somebody? By avoiding the difficult conversations, they stretch out the process. Often when the employer finally walks down the path to fire someone, most of the employees say, ‘It’s about time. I didn’t think you guys would ever do it.’”
How and when firing takes place can affect workplace morale because everyone is watching. McPherson notes that even if others are wondering why someone has not been terminated for poor performance or behavioral issues, management may be implementing an improvement plan. They are respecting the employee’s privacy by not advertising this corrective action. “Once you have given an individual the opportunity to course correct, you have to wait and watch their performance, and that can take time.”
Human Relations outsourcing
As an outsource HR firm, Leap Solutions assists businesses without a human resources person on-site. The employees usually know the firm is outsourced, so they have the option to contact Leap Solutions directly and get advice as they would with an internal HR department.
For example, McPherson says, “If someone feels that their boss is picking on them, we’ll coach them on how to have a conversation. We may even facilitate bringing the boss and employee together to have that conversation, to get the expectations clear and to make sure everyone is on the same page. When you talk about picking up the pieces, there are situations where clients don’t always follow the great advice that they’re given. Sometimes the termination is just because the individual was not a good fit for the company culture, and they move on to become an excellent performer in another situation.”
McPherson’s team has knowledge of all new employment laws and the many rights of employees. They make sure all paperwork is aligned and will be witness to the termination, if asked. “Typically, two people are in the room. Three would feel like ganging up. We provide support at the meeting and try to create a neutral atmosphere. Often when the manager has had enough, emotions are running high, and we try to diffuse that ahead of time. We work with legal if we think there might be risk involved in the termination.”
Kari J. Brown, a partner at Spaulding, McCullough & Tansil LLP, specializes in Labor & Employment Law and Litigation. While she represents businesses with varying needs, from small mom-and-pop to those employing more than 500, the one thing she says they all recognize is that they need legal assistance, especially when it comes to terminations. “The wisest thing to do before they let someone go is to call us.”
The client may be thinking in terms of logistics like final paycheck, severance agreement and other required paperwork, but the first question Brown asks is: Do you want to talk about risk?
If her client says the employee is not a good fit, Brown will continue to “poke at” the situation for more information. “Has the employee made any recent complaints about discrimination, pandemic protocols, sexual harassment, failure to provide benefits, or anything that might be considered whistleblowing? If it’s an absentee issue, I’ll ask for the reasons the employee was missing work. Was it sick time, a medical issue, a disability they are trying to accommodate? Was it leave they were entitled to? A worker’s comp issue? If an employee complains about not being paid properly, is there misclassification risk, such as paying an employee on a salary basis when the individual should’ve been classified as non-exempt (hourly) and received overtime, and meal and rest breaks? There could be huge exposure for the company in the termination, and maybe the employer isn’t even aware of it.”
Brown recommends that even if an employer feels they are on solid ground with documented conversations, performance reviews, and coaching provided, they should reach out to their legal advisor. There may be more issues than they realize. Was there good communication? Has the person been warned, or will the termination seem to come out of the blue? Brown noted that, especially during the pandemic, there was a reluctance to have those talks that may rock the boat or make an employee angry and affect workplace morale.
“Doing a risk analysis is important, especially with a small business that might not have Employment Practices Liability Insurance or an HR person who can help. Taking these steps could help save their business,” Brown says. If an employee thinks the dismissal is unfair—or that the reasons given for the dismissal don’t make sense based on the feedback received while employed—the individual may try to pivot the circumstance to something that might have a legal basis to challenge.
“After a contested firing, we see demand letters from the employee’s attorney and my client has to spend time and money to defend against that even when the termination was justified and legally supported. Even pre-litigation, the discussions and negotiations can be time-consuming and expensive for the client. My conversations with the opposing counsel take time, and if we find some merit to the employee’s claim, then there’s additional time and expense involved in negotiating a settlement.”
A demand letter is sent by a plaintiff’s attorney that outlines all the complaints they think their client has, even before litigation begins. Brown says, “They will make as many claims as possible, based on their conversations with their client and request personnel files and payroll records. Plaintiff attorneys typically lodge a litany of complaints to see what sticks. At the end of nearly all demand letters, they will calculate the exposure they think the client’s claims amount to.” For example, the attorney might say that a conservative estimate for recovery of damages, along with attorney’s fees, could be $500,000 at trial, but they will offer to settle for considerably less than that amount pre-litigation, based on the cost, time and stress involved with filing a lawsuit. This triggers the negotiation process.
In Brown’s experience, the common thread among her clients who have the fewest demand letters or who have never been sued by an employee, is that they are very good at communicating all along the way with their employees—even when a conversation is uncomfortable.
“When you give the needed feedback and it works, you end up with a mutual understanding and a better employee. If the termination does happen, the employee comes to see that they didn’t perform or improve or that it wasn’t a good fit for them anyway. It doesn’t always work out in a fairy-tale way,” she admits. “But it’s much less likely that the employee will come back and say you’ve terminated them for an unlawful or unfair reason.”
When managing a tricky termination, Brown strategizes with her client as to the timing of it, making sure that an explanation of the firing is communicated to the rest of the employees without disparaging or humiliating their departing co-worker. The goal is to separate the relationship amicably.
“There is no rule that applies to all circumstances,” Brown concludes, “because there is always the human factor, especially if the business is small or of moderate size, and maybe the owner is the only one available to handle it all.” In these cases, she often refers her clients to an HR consultant to assist with the process. The consultant can process the correct paperwork, act as a witness to the termination, keep the process on track and the behavior civil, and advise for future terminations. Outsourcing is also a cost-effective way for the business to manage HR processes.
The Personnel Perspective, based in Santa Rosa and Napa, provides a full scope of services: HR and organizational development consulting; leadership training and coaching; facilitation; executive search and recruitment; and conflict resolution. The firm’s operation manager, golbou ghassemieh (who prefers to use lower case letters for her name), is a senior consultant with 18 years’ experience in human resources, organizational development and leadership training. She has worked for the City of Santa Rosa and the County of Sonoma.
When asked about the termination process, ghassemieh, like Chuck McPherson of Leap Solutions, immediately references the origin of the employer-employee relationship. “It’s the supervisor’s capability to set up the employee that plays a big role in whether the person will perform effectively,” says ghassemieh. “So, when we talk about termination, we must backtrack to see if expectations have been made clear. We look at a few simple things. Did they go over the handbook, policies, expectations, job description and performance standards with the new hire, and is that all documented? Does the person understand the policies and expectations? Were they trained effectively? Did they get onboarded in a way that set them up for success to begin with?”
Terminations are either performance-based or a conduct issue, and sometimes it’s both. When it comes to egregious conduct, things like embezzlement, intentionally creating a safety hazard or damaging company property are clear-cut policy violations. When the termination is performance-based, the question is whether the individual has the knowledge, skills and abilities to meet the job expectations and whether they are being productive.
For ghassemieh, success begins with hiring. She emphasizes the importance of having an effective vetting and interview process and carefully checking references, because there are some things that are trainable and some things that are not. For example, you can train how to operate a cash register, but you can’t train attitude or analytical skills. It is the untrainable things that might cause problems with the employee. The rest is up to the supervisor who must pay attention to the employee and instruct them into the company values and culture.
“The best way to frame onboarding is to think that this person is walking into a foreign land,” she says. “Everything is unfamiliar. Maybe they know your business as a customer, or client, they may understand your brand, but they don’t know what it’s like to work for you. Your job is to make the unfamiliar familiar. It’s going to take weeks and months to get the person to the point of understanding their job and the culture so they can fully bring in their skill sets.”
When a business calls The Personnel Perspective to assist with a termination, after the conversation about how the employer built the relationship in the first place, they talk about assessing the possibility of a lawsuit. “There is always risk in having employees,” ghassemieh says. “We have many laws protecting employees by which our state allows them to file a claim. We try to assess if the risk of firing is greater than the harm of keeping the employee.”
Whether the leader is a front-line supervisor, manager of a division, or an executive, she offers this advice for dealing with what can be an emotionally fraught situation.
“The person in charge must have self-awareness and know what their fight-flight-freeze responses are in a stressful situation, because firing is stressful for both the person doing it and the employee,” she says. “Bring in those self-care practices we’ve all read about. Be sure you’ve gotten a good night’s sleep and have eaten appropriately. Then tap what else you do in your life to take care of your mental health, like meditating, taking a walk or having social time.
“You need to be kind and gentle with yourself because it’s tough to fire someone,” adds ghassemieh. “It’s going to raise your cortisol level if you feel threatened or challenged. You need to achieve physical and mental balance, so when you walk in that conference room and nerves are jangling, you have your coping strategies ready. Of course, you should treat the person with compassion. As a human being they are going to have their emotional response, too.”
If the supervisor has come to know the employee within the workplace, perhaps they’ve already had some interaction and are aware of what their reaction might be. Sometimes the risk is not that the employee is going to file a claim, but that the individual is a safety risk, and security might need to be close by. The most mild-mannered person can get violent under stress. This is another reason to have the HR consultant present as a steadying influence.
“People say all kinds of things when they are angry and fearful. Let them vent if they need to,” ghassemieh cautions. “It doesn’t warrant a response; not everything warrants a response. You can simply say, ‘I understand…and the decision has been made.’”
On the positive side, she experienced a situation in which the employee was relieved, almost ecstatic, at the termination because it wasn’t working out at the company. So much was happening in the individual’s personal life that the ability to address the difficulties at work was overwhelming. Being fired turned out to be a blessing because the individual then had the time and space to sort out the things they needed to address, and to seek employment that was a better fit.
“I saw this individual at an event and I thought it was going to be awkward, but they gave me a hug and were happy to see me,” ghassemieh recalls. “They affirmed that they were currently doing well, and that the firing had been right. It was one of the best scenarios I’ve been involved in.”
Adhering to ethical and legal dos and don’ts allows an employer to sever the relationship with an unsuitable employee respectfully and with grace. McPherson concludes, “If you do it wrong, news will get around by word of mouth. If you do it right, it becomes a win-win for everyone.”
Human resources professionals may offer a variety of best practices for terminating an employee gracefully. Here are some tips they have in common, regardless of the type of business involved.
Communication and Feedback. Make sure employees know when they are failing and provide opportunities to improve before taking the final steps.
Legal Consultation. Check with your attorney to assess possible lawsuit risk.
Get all documents in order beforehand. Performance appraisals, warnings, documentary emails, terms and conditions of dismissal, final paycheck, etc.
Choose the proper time and place. Consider the employee’s privacy. Earlier in the week and end of the day are considered preferable to minimize business impact.
Have a witness present. HR, or HR consultant, or the employee’s supervisor can also provide support in an emotionally-fraught circumstance.
Keep the meeting short and to the point. Be clear that this is not the time for argument, the decision is final. Keep calm, without being hard or cold.
Secure company files and property. Make sure the employee’s access to records and passwords are ended and company assets (phones, laptops, etc.) are returned.
Treat the employee with respect. Don’t fire over electronic means, don’t rehash grievances, or get personal. Be honest and straightforward.
When appropriate, have someone escort the employee out. This is a delicate balance. You need to protect your company from a disgruntled individual, but you don’t want to humiliate them either.
End the meeting with something positive. Depending on the circumstance, you can thank the employee and give encouragement, or suggest a better fit for their skills. Sometimes the HR consultant can help the employee with next steps.
Firing a High-Level Executive
What happens when the person who needs to go is a high-level executive? Firing an executive or high-ranking employee is a bit more complicated.
“Employees in executive and high-level management positions often have contracts that dictate the terms under which they can be terminated,” says Kari Brown, partner, Spaulding, McCullough & Tansil LLP. “These contracts typically have provisions related to termination or severance that must be complied with.”
According to Brown, the first step an employer should take is to check to see if such a contract exists. If that’s the case, the next step is to evaluate how to proceed with the contract terms in mind. Even when there is no employment contract, it’s a good idea to assess the situation before moving forward with a termination. “There may be other factors to consider, such as requirements related to tenure and collective bargaining agreements, if the employee is a union member,” says Brown.
If the individual is under contract, what’s outlined in it also matters, according to Chuck McPherson, a partner at Leap Solutions in Santa Rosa. “A contract might say that if the employee is fired, the person gets some sort of severance,” says McPherson. “But if someone is fired for ‘no confidence’ or something egregious, the severance could be off the table.” It depends on the situation, he adds, and oftentimes there are variables to consider.
The key to firing an executive correctly is preparation. “I recommend that employers seek legal counsel for drafting executive employment agreements and review their termination policies at least annually to ensure compliance with current laws and best practices,” says Brown.
Learn from the experience
And once a company fires a high-level executive, it’s also a good time to figure out why the wrong person was hired for the company in the first place. According to McPherson, it’s usually due to skill, cultural fit or both. “This is something that needs to be vetted out during the interview process,” he says. “If there are red flags—or your gut instinct is telling you something during the process—listen to it and explore further through reference checks and ask specific questions around your potential concerns.”
What’s more, when there are red flags during the interview process, McPherson advises circling back with the candidate with additional questions before making a job offer. “A job description says lots of things, but most are skill-based concepts,” he says. And the term “other duties as required” is a catchall, he adds, which is usually the last bullet point in a job description. “There’s no way to list every single point in a job description, which is why it’s a catchall and why you don’t want to remove it,” says McPherson. Part of the job may be understanding the politics within a peer group and managing it, he says, but it’s not specifically listed in a job description.
And though it may seem a vague catchall that could be eliminated altogether from a job description, he advises keeping it in place because it allows the employer to “course correct,” if needed. “If a job candidate asks what that means,” says McPherson, “the hiring manager should be able to provide some examples.”