Termination Planning: What You Need to Know
Terminating an employee can be like playing with fire. Whether an employee’s role has become redundant, or whether the employee is no longer meeting expectations (or even committing serious policy violations), sometimes employment relationships need to end. Just as in the end of a romantic break-up, termination is not a fun or pleasant process, but can definitely be the healthier choice for both parties.
Yet terminating employees has something else in common with playing with fire – taking advanced care and precaution can skillfully avoid a tremendous amount of pain. Otherwise, much like fire, a poorly-planned, or poorly-conducted termination meeting can go horribly awry. Most large employers have an arsenal of horror stories of employees becoming overly emotional, disruptive, or in horrible cases even violent. Even if an employee appears to take the news relatively well, employers must always be cautious that they are not met with a legal claim for wrongful dismissal soon after.
There are, however, right ways to conduct an employee’s termination meeting, and as HR professionals we are experts in doing so. We have a longer termination checklist available for those interested, but we wanted to take this opportunity to share some of our wisdom that we have collected over the years.
Do your homework before the termination meeting
The worst thing you can do prior to terminating an employee is fail to do your homework. Gather and review all of the relevant documents pertaining to that employee, including their performance reviews, attendance records, and any other key documents that you may have on file. Calculate what sort of payment they will be owed, both at law and under the terms of their employment agreement. If they have no written employment agreement, remember that they are owed at least their legal minimums including any termination, severance, and outstanding vacation pay.
If their contract entitles them to more, then ensure that those terms are met. These are tricky calculations to make, and there is no precise formula for amounts above the minimum legal entitlements. Remember, if you are only offering their minimum amounts, nothing is in place to prevent them from suing for more money. Similarly, if you are offering more money than the employee is entitled to under their contract, remember that that can come in exchange for a release preventing them from making a legal claim.
Write a thorough termination letter
One benefit of having policies is that you do not have to do the heavy lifting at every turn. Policies can assign duties and responsibilities to other managers within your team, especially when it comes to reporting or enforcement. Vacation requests, for example, can become the responsibility of a direct manager. As the team grows, other managers can take on additional responsibilities under these policies, taking some of the weight off of the C-Suite’s shoulders.
Your termination letter does not have to list the cause for their dismissal, as most dismissals in Ontario are without cause, and cause only matters in the most serious of cases. It should, though, outline exactly what you expect from the employee, and exactly what they should expect from you.
This includes items such as what date the employee can expect to receive their final payments, how long their benefits will continue to run, how they can submit any final expenses, when their Record of Employment will be completed, and any other items that they should know in writing. The termination letter can also include the employee’s responsibilities in this process, such as informing you when they become re-employed (if they are being paid out on a salary continuance option), and their responsibility in returning any company property. Remember, this is the letter that sets out your official position, and once it is provided to the employee there is no turning back.
Handle the meeting with care
Termination meetings should be handled with extreme caution to avoid that risk of proverbial broken glass. There are varying schools of thought for the best time of day/day of the week to conduct a meeting, but there is no perfect time. They should though be done discretely, in a private room away from the prying eyes of colleagues. Be sure to have a second person present whenever possible. Stick to your planned agenda for the meeting, and take the time to go through the termination letter with the employee even though you will send them a copy via email or post.
Do not let them sign anything during the meeting – they should be reminded both verbally and in writing that they have the opportunity to review the situation with a lawyer before agreeing to your terms.
Most importantly though, even though this is a business meeting, remember it might also be the worst day of someone’s life. Do not hesitate to bring kleenex, give the employee a few minutes to collect themselves, and if meeting in person ensure that they have a safe ride home.
Follow through on next steps
The termination process does not end as soon as the employee leaves the meeting. The Record of Employment must be completed 5 days after the last day of work and sent to Service Canada for processing. If there is an imposed deadline for an employee to respond to a termination offer, make sure that a line of communication (not through the business’ internal network) remains open until the end of that deadline. Lastly, remain tactful and professional when informing colleagues of the departure. Hurt feelings are often the motivator for claims of wrongful dismissal, and may be easily avoidable by keeping the employee’s dignity intact wherever possible.
This is just some of the wisdom that we have amassed over the years. There are several more technical aspects of termination meetings in our work, such as determining how to best structure an appropriate exit package to avoid litigation, or how to carefully draft a release that protects your business in exchange for an enhanced exit package. These are often challenging questions, and require both knowledge and skill to resolve with minimal noise.
Our team of fractional HR professionals is only a phone call away. We are well-equipped to provide outsourced HR services such as termination strategy and planning so that you do not have to stumble through this process alone. Mistakes in this process can be costly, such as overpaying for termination pay, or setting yourself up for unwanted legal exposure. We provide our clients materials to educate them on their requirements, their risks, and the best practices that will help ensure success moving forward. Contact us today for a copy of our termination checklist and to learn more about our services.
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