Letting an employee go is never easy—but when it happens, no matter the root cause, companies have to act with professionalism and follow correct procedure. It’s the right thing to do, but it’s also essential for compliance. To help you make sure everything is done by the book, Paycor is providing a checklist of the right actions to take.
How to Conduct an Involuntary Termination
An involuntary termination can never be taken lightly, and before making the decision official you’ll want to confirm with your legal team or advisors that you’re following the right process. If the termination is the result of poor performance or disciplinary issues, the employee may well have been issued warnings of increasing severity and been aware they were at risk of losing their position.
Once the decision is made, it’s time to follow official company policy as well as state and federal law. Even if you’re eager to conclude things as quickly as possible, there’s no excuse for rushing things or skipping steps.
The employer’s tasks can be broken down into parts:
1) Compliance + Forms
2) Severance Meeting
3) Post-Separation Admin
When conducing an involuntary separation, the first task facing businesses is preparing a final paycheck according to state requirements. You should also be aware of PTO payout laws by state. Your next job is to prepare any appropriate forms—this includes state unemployment forms, a termination letter and, if applicable, a severance agreement.
You will also need to contact any group insurance provider and, if necessary, a COBRA administrator.
Now comes the most important part: meeting with the employee. Here’s what not to do:
- Provide multiple, inconsistent reasons for the termination
- Rush the meeting and skip key topics
- Vent your anger by verbally abusing the employee
Instead, explain the decision clearly but concisely, without leaving room for misunderstanding. You’ll also need to inform the departing employee of:
- The end date of their group health benefits and their COBRA rights
- State rules on unemployment and how they can claim benefits
- The impact of their non-disclosure agreement (if applicable)
- Any references the company will provide
- The date by which any severance agreement must be returned, signed (if applicable)
The meeting is also the opportunity to collect any passwords and to request the return of company property. Afterwards, you’ll want to offer an opportunity for them to clear their desk and pick up belongings, before ensuring they are escorted out of the building.
The responsibilities do not end there. After an employee has departed, senior management, key team members and anyone with whom the employee worked must be informed. The IT department should also know, so that any relevant accounts can be deactivated.
You’ll then need to update your HRIS system and file all employee information under “terminated employees”. Lastly, you should keep detailed documentation of what was discussed at the severance meeting, in case the content of the discussion is later disputed.
Get Involuntary Termination Checklist
It’s essential that businesses know exactly how to conduct an involuntary termination. To help you stay compliant, Paycor is providing a downloadable checklist of what to do.