Signs That It’s Time to Let an Employee Go

As an employer, letting an employee go or employee turnover may be a natural part of running an organization, therefore potentially making it necessary to terminate members of your staff.

However, while employees being terminated involuntarily may be inevitable due to various reasons, such as misconduct or performance issues, that does not mean you and your fellow decision-makers can afford to take such decisions lightly.

Key Factors When Considering Termination or Letting an Employee Go

Deciding to let an employee go may often require careful vetting. Even in situations where the need for termination may seem clear, your business should tread lightly and do its due diligence. Consider the following:

• Past reviews—One of the most common reasons an employee may be let go is underperformance in their duties. Revisit past reviews to ensure you are accurately assessing their contributions and avoiding recency bias.

• Previous correctional efforts—If an employee has been warned in the past that their work is substandard, your company should carefully analyze the results of any efforts made to rectify the situation, such as formal performance improvement plans.

• Inappropriate conduct—Not all involuntary terminations are due to performance issues. Should an employee be guilty of workplace misconduct, such as violating company policies or contributing to a toxic work environment, your organization may also need to let them go.

• Multiple opinions—While an employee’s direct manager may often be the best source of accurate feedback regarding their performance, it may be advisable to gather information from multiple sources while requesting specific examples of their contributions or lack thereof.

• Other options—Termination should often be the final choice, as firing an employee can be detrimental to workplace morale and incur significant costs related to searching for and hiring a replacement. Explore all possible avenues for improving an employee’s performance, including composing a development plan or assigning them a mentor.

• Expert input—Enlist the assistance of your HR department early in the process when considering termination. Adhere to their guidance regarding handling the situation and what needs to be documented. Ensure that you are in compliance with all relevant employment laws, as failing to do so could lead to costly lawsuits.

If you have conducted your due diligence, made efforts to rectify an employee’s performance, gathered feedback from multiple sources and ensured legal compliance, you may eventually conclude that you need to let an employee go.

Still, you should be prepared for potential ramifications, as wrongful termination lawsuits are not uncommon, necessitating appropriate insurance coverage.

We’re Here to Help

At Lyceum Insurance Services, we understand that letting employees go is a difficult task for many reasons.

Our knowledgeable team will work with you to help make this process go as smoothly as possible while ensuring you are protected by adequate insurance solutions, such as a robust employment practices liability insurance policy.

Contact us today to learn more.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.