Employees are your company’s most important asset. When one of them leaves – whether by their choice or yours – morale, productivity and sometimes even your company culture can be affected.
Some employee turnover is inevitable when you own a business. Knowing how to handle it effectively will minimize the effect on your remaining employees and reduce the risk of legal action against your organization.
In Kansas, Missouri and other at-will employment states, employers may fire employees for any reason at any time. But that doesn’t necessarily mean they should.
To minimize the potential for wrongful termination claims, follow predetermined, written procedures when you tell an employee to leave your company. Generally speaking, you should:
While firing someone is never a pleasant experience for anyone, other best practices will help make the termination as easy as possible. Preparing what you will say, while remaining unemotional yet sensitive and respectful, will yield the best result.
Employers should be familiar with Internal Revenue Service (IRS) codes that regulate the health benefits of departing employees. COBRA health insurance, for example, must be offered to employees – and in some cases, to their spouses – who experience “qualifying events” such as terminations. Some of these events cause a dependent’s “involuntary loss of eligibility” for COBRA coverage.
A termination also affects the use of any money left over in the former employee’s health flexible spending account (HFSA). The IRS does not permit HFSA disbursements, transfers or rollovers after employees are terminated – unless they are covered by COBRA.
Although it’s fairly rare, employees may legally and sometimes do quit their jobs without any notice. Sudden and unexpected partings cause workplace anxiety and raise questions about how critical tasks will get done and who will have immediate responsibility for the departed employee’s work. To mitigate the disruption, quickly:
Read more on Axcet HR Solutions' blog post about what to do when an employee resigns without giving notice.
Employers almost always take a systematic approach to integrating new employees but often are less strategic about how they handle staff departures. Given the fact that millennials spend only an average of 1.3 years in any position and 10,000 baby boomers retire each day, “offboarding” policies are as important as onboarding new hires in this era of increasing turnover. A consistent offboarding process also serves your company by providing a checklist to ensure you’ve taken care of business necessities, such as getting company-provided devices back from the employee and gaining valuable feedback through an exit interview.
Employee departures, whether at the company’s volition or the employee’s, almost always are jarring. Handling them effectively will help you and your organization get through the upheaval and recognize that these departures also provide an opportunity to examine and realign staff resources if needed and find the right new employee to take your business to the next level.
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