Get All Access for $5/mo

How to Respectfully Terminate Employees These 4 tips will help avoid lawsuits and keep your reputation intact.

Terminating employees is never an easy thing to do. There is a right way and a wrong way of doing it--with suitable guidance respect for all involved parties can be intact.

There are three key aspects of a proper termination: legal, psychological and sociological. The legal component involves reviewing the law and making a reasoned business decision, reviewing records and obtaining valid releases of potential claims. The psychological component involves allowing the terminated employee to tell his or her story and leave the company with dignity. The sociological component involves considering the impact of a termination on remaining employees and the outside world.

1. Strive for objectivity. Emotions run high in an office environment, especially during difficult economic times when both employees and employers feel constant pressure to perform. The decision to terminate--like most employment decisions--should be a factual business judgment rather than an emotional response. Nobody should have the universal right to fire an employee without proper protocol that involves oversight. The most severe action taken by any individual within an organization should be an administrative suspension that gives the company proper time to collect and review its facts and consult with counsel if necessary.

2. Create a bridge to the future. It is important for companies to protect their reputation when terminating employees. Past employees may not only be future sources of business, but how a company handles terminations can also affect its future success recruiting sought-after workers. Employers should strive to separate individuals through a process that helps the employee leave the company with his or her pride intact. It is critical that someone within the organization, whether it is the individual's direct supervisor or someone in human resources, allows the employee to tell her story. A terminated employee should understand that while the employment relationship did not work out, the employer appreciated her service and does not fault her in a personal sense. Employers should make an informed decision regarding whether to contest unemployment, as this may also impact the employee's perception of the company.

3. Review records and organize paperwork . If a terminated employee decides to seek legal counsel for a potential discrimination or other claim, the plaintiff's attorney may look to find violations the employee was never even aware of. Employers can ward off potential claims by carefully reviewing an employee's accrual of vacation time and reviewing records for any potential wage and hour violation early on to ensure a plaintiff's attorney doesn't discover some impropriety down the road. Companies should consider requesting the terminated employee signs a valid release of potential legal claims. It's important to remind the exiting employee of any ongoing obligations such as maintaining the confidentiality of trade secrets.

4. Recognize lessons learned . Although the company may think it handled a particular termination well, employee sentiment may not line up with the employer's perception. It is important to talk to employees and supervisors left behind to ascertain their thoughts and feelings about how the company handled the departure keeping in mind confidentiality issues relating to the termination. This helps prevent low morale following the "resignation" of someone well-liked within the organization and helps the employer gain insight for how to handle similar situations in the future.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick


Are Your Business's Local Listings Accurate and Up-to-Date? Here Are the Consequences You Could Face If Not.

Why accurate local listings are crucial for business success — and how to avoid the pitfalls of outdated information.

Money & Finance

Day Traders Often Ignore This One Topic At Their Peril

Boring things — like taxes — can sometimes be highly profitable.


Want to Be More Productive Than Ever? Treat Your Personal Life Like a Work Project.

It pays to emphasize efficiency and efficacy when managing personal time.

Business News

'Passing By Wide Margins': Elon Musk Celebrates His 'Guaranteed Win' of the Highest Pay Package in U.S. Corporate History

Musk's Tesla pay package is almost 140 times higher than the annual pay of other high-performing CEOs.

Growing a Business

He Immigrated to the U.S. and Got a Job at McDonald's — Then His Aversion to Being 'Too Comfortable' Led to a Fast-Growing Company That's Hard to Miss

Voyo Popovic launched his moving and storage company in 2018 — and he's been innovating in the industry ever since.

Starting a Business

I Left the Corporate World to Start a Chicken Coop Business — Here Are 3 Valuable Lessons I Learned Along the Way

Board meetings were traded for barnyards as a thriving new venture hatched.