Ensure a smooth and respectful employee exit with a clear termination policy that outlines essential procedures. Protect your business from legal issues and provide transparency for all employees during the termination process.
By Brad Nakase, Attorney
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Sometimes, in spite of the best efforts made by employers to keep their staff, a relationship needs to end. To make it clear when an employment arrangement ends, all companies must have a worker termination policy in writing. What essential elements must be included in your exit procedures and termination policy? What factors should you take into account while creating a strong termination policy? How should your company safeguard itself and make sure the dismissal goes smoothly?
A thorough termination policy aids businesses in streamlining this procedure to prevent negative disruption to business, including a negative impact on morale. It also assists staff members in knowing what to anticipate prior to, during, and following their departure from the organization.
To put it simply, a worker termination policy is an official document that outlines the procedures for terminating employees within your company. It gives management and HR personnel guidance and describes every stage of the termination procedure. In order for workers to understand why and how they can lose their jobs, this information must be transparent and unambiguous. Additionally, the policy makes it plain how individuals may, at any time down the road, willingly leave their position.
When a worker quits a business, it can be difficult for the HR department and the person who quits. It is less stressful because of the structure that the termination policy offers. It also talks about what is expected of each party. An employee is aware, for instance, that being escorted from the business property and to their car on the final day of work is a matter of respect (and security); it is not intended to be offensive.
A termination policy explains how this procedure is carried out in a professional setting, much as a company has written policies to handle different areas of employment.
A documented worker termination policy is essential for shielding your company from legal liabilities and the dangers that come with terminating employees. The termination policy also specifies how a worker being fired is to be treated with respect, which is a moral requirement.
The following are various reasons why your company needs an official worker termination:
Today’s businesses are overburdened with work as they concentrate on creating cohesive and successful teams. A lot have expanded internationally or use remote workers. Codified worker termination procedures and policies help organizations meet important legal requirements, such as defining voluntary versus involuntary termination. This helps in preventing litigation and accusations of wrongful termination from popping up.
Because termination is a delicate matter, workers may react strongly emotionally to it. This applies to both the impacted worker and the workers who are left over to handle the additional workload. Employers can ensure that their termination policy is as honest as possible to help lessen the stress of this change for everyone.
According to Lindsay Witcher, vice president of practice strategy at Randstad RiseSmart, be sure to be honest and empathetic while handling a termination in a virtual meeting with a remote worker. Be open, specific, and as obvious as possible with your message, she continues. This will help avoid miscommunications.
One of the toughest times in a company is when workers are laid off due to not enough work. Any firm can be affected by the economy, necessitating the reduction of part or all of the personnel through layoffs. The written termination policy must include information related to The Worker Adjustment and Retraining Notification Act (WARN). The Act mandates that companies with one hundred or more workers give 60 days’ notice in advance of closing a plant or laying off fifty or more people at once. Review the applicable laws in the countries where you conduct business.
A documented policy outlines the penalties for bad behavior and rewards good performance. Information about worker termination must be included in the performance and disciplinary procedures as part of an organization’s policies.
For instance, giving a spoken warning for a first transgression at work is typical procedure. If the issue still exists after that, formal notices will be sent. Even though it should only be used as a last resort, firing an employee for chronically poor work or conduct that endangers the company and other employees may be justified.
An effective worker termination policy includes all the details management and human resources require to handle the termination of an employee’s employment. The worker termination policies and procedures should contain the following components, which you must include:
Employees must be aware of the different forms of termination from their jobs and the implications for their careers. For instance, if an employee voluntarily quits, they are free to do so whenever they give their employer appropriate notice. In order to maintain business continuity and to leave the door open for potential future employment prospects after resignation, it is vital that you say this.
Interruptions in employment, including furloughs, contract completion, retirement, reduced hours, personal or family medical breaks, etc., shouldn’t have a long-term negative impact on workers.
It’s crucial to remember that if a worker “no shows” for several days, it’s regarded as voluntary separation or job desertion. The worker would then be disqualified from being hired again.
Employers are not to blame for involuntary terminations brought on by employee insubordination, contract violations, persistently poor performance, dangerous or unfavorable behavior, violations of workplace policies, or unlawful action. The procedures for employee coaching and discipline must be specified in the termination policy. This may entail potential assistance from the business in addressing problems related to substance misuse or obstacles to productive work.
Termination policies also need to contain essential details like who is covered, how warnings are given, and how each termination is handled. The plan should specify who is in charge of handling worker terminations, how they should be documented, and how much HR should be involved at first. This may vary depending on the kind of termination that is necessary, but the policy ought to include a thorough explanation of the fundamentals.
Take into account the combined experience of the management team and the employees. What information is necessary for them to know in order to avoid endangering the firm or themselves? A common example is the amount of notice that a departing employee ought to provide to their employer. Workers might be unable to give the required two weeks’ notice if they receive a job offer from another employer. How will this be resolved so that the worker can depart amicably? In the event that an employee must be fired for disciplinary grounds, what rights does the company have? All of these issues should be covered by the policy.
The offboarding checklist is a helpful element that should be included in all worker termination procedures. It helps in outlining the procedures and rules for the worker’s last days, including the final day of work. You should have a systematic procedure for assisting new personnel in leaving the company, the same way you take the time to onboard them. How and when to return business property (uniforms, mobile phones, cars, keys, etc.) might be included in the offboarding checklist.
Share with staff members what is permitted for “going away” celebrations when they leave to pursue other professional goals. Arrange for the employee to participate in an exit interview in order to gather data for retention initiatives. Lastly, arrange the employee’s last day on the job. This may entail having security take you out of the office and denying you access to the company’s computer system.
A company may frequently decide to provide the terminated worker with a severance package. This can lessen the impact of an involuntary termination brought on by a layoff or liquidation of the company. The usual severance package, which lasts until COBRA takes effect, includes a month’s income and access to the employer-sponsored benefit plan. It might also include extra benefits like stock options or a monetary bonus. Having a letter of recommendation ready to present to the departing worker is also important.
Create a letter outlining the conditions of the severance package for the employee to study and sign.
Many workers were placed in an unusual situation as a result of the COVID-19 outbreak. Because of the nature of their jobs, they were either forced to work from home or could no longer complete their work. Some states provided substantial unemployment benefits, enabling people to weather difficult times. Others were slow to respond and did not contribute the funds required to pay for even the most basic of needs. In the midst of a pandemic, these employees were obliged to look for alternative employment opportunities, which was a difficult proposition.
Assume that your business is in such a situation. In this case, you can offer employees the opportunity to leave, but pay a more generous severance compensation with sufficient medical benefits to safeguard their professional reputation.
In addition to benefits related to pandemic preparedness, adding career outplacement services may boost your company’s standing while easing layoffs. This entails offering career guidance and assistance in finding new employment for a maximum of six months.
Make a communication plan with the members of your remaining team as well. Inform them of what to expect and the responsibilities that must be covered until a new employee can be hired.
It is only right to include a few additional tips to ensure your employment termination policy is well-constructed and managed. So, as you create your company’s worker termination policy, remember these things.
Terminating an employee isn’t the most enjoyable HR procedure. A well-crafted termination policy aids in the navigation and clarification of this procedure and its steps for both you and your staff. It also aids in shielding the company from baseless lawsuits and accusations brought by resentful former workers.
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