Request a call Login

  • Terminating an employee is an unfortunate, yet sometimes inevitable aspect of running a successful business. For a small business, where owners and employees often think of themselves as a “family,” terminating an employee can be an especially difficult decision. When the employee who is being terminated and the owner or manager have a long work history and possibly even a personal friendship, the situation can become even more charged. As a business owner, it’s important not to let personal feelings get in the way of making sound business decisions.

    terminated employee packing desk

    Signs It’s Time to Part Ways with a Long-Time Employee

    Many employees can thrive in their careers working decades for the same employer. Long-term employees who continue to provide value to your business have deep knowledge about your products, services, systems, and business structure and are certainly worth holding onto.

    Sometimes, though, even employees with long tenures at an organization can create difficulties that can be draining on a business. Although sometimes difficult to admit, if you’re honest with yourself, you may already have an idea of who these employees are. Long-term employees who have overstayed their welcome typically exhibit the following traits:

    Obsolete skills

    It often becomes clear that a long-term employee hasn’t taken responsibility for their career or training when they don’t actively seek out new information or express little if any curiosity about their industry or profession. A noticeably stale skill set is often one of the first signs it’s time to let a long-term employee go. These employees often have an outdated mindset and little, if any knowledge of current best practices. They only know what they’ve learned early in their career and have continued with those same processes for years, sometimes for decades.

    Resistance to change

    As industries and technology evolve, so should a business. A resistance to change could be holding your company back from operating at its full potential. You could be missing out on key opportunities to reach new markets or create innovative products or services. When an employee is perfectly content maintaining the status quo, it could be a sign that it’s time to move on.

    These types of employees tend to be champions of old systems and familiar processes. You may often hear them say things like, “This is how we’ve always done things.” When employees are constantly undermining change and new or progressive initiatives, it’s typically a clear indication that it’s time to let that employee go.

    Defensive attitude

    Long-term employees may be painfully aware of their dwindling value within a company. As a result, they may feel threatened over particular aspects of the job. These types of employees may become defensive when questioned or having to justify their processes. They might even undermine or sabotage new hires by hoarding information or dismissing a new hire’s ideas or skills.

    Slower productivity

    Long-term employees may no longer have the skills or capabilities to efficiently produce high-quality work or work quite as fast as their peers. As a result of not having the appropriate skills for their position, long-term employees may try to compensate by working long hours and weekends. These types of employees often claim they are overworked and may even be too busy to attend meetings. They’re critical of co-workers who have a life outside of work and don’t put in extra hours. They may even see themselves as company martyrs and call out co-workers who don’t spend as many hours working.

    Overcompensated

    Often, long-term employees have incurred higher salaries over their tenure that can weigh heavily on a company’s bottom line. Of course, long-term employees who continue to provide value and have experienced growth within your organization are likely deserving of a higher paycheck. However, it can be harder to justify when a long-term employee’s salary and title is grossly inflated to reward them for their tenure when it doesn’t correlate with the value and skills of other employees.

    How to Terminate a Long-Term Employee

    When it comes to terminating a long-term employee, much of your usual termination process will be the same. However, there are some special considerations to keep in mind when firing a long-time employee.

    Review past performance

    Termination can certainly come as a shock to an employee, especially one who may have felt secure in their tenure with a company. You’ll want to ensure due diligence by reviewing past performance reviews and feedback. If the employee has only ever received positive feedback, you may want to wait until you can provide some honest feedback and evidence of negative performance. An employee performance review is an optimal time to set goals and expectations for an employee, identify areas for improvement, and provide resources for training. You may notice signs like resistance to change or a defensive attitude during this time.

    Terminate long-term employees in person

    When it’s clear that a long-term employee can no longer provide value to your organization, it’s time for termination. When firing a long-time employee, be sure to give them the news in person if possible. Not only is face-to-face firing the right thing to do, it can also help keep your remaining workforce strong, especially when losing a long-time colleague.

    Be transparent with your remaining employees

    Speaking of your existing workforce, you’ll also want to take into consideration how you communicate the termination to the rest of your team. The “loss of a colleague can send shockwaves—and extra workload —across the company. By firing someone, you’re asking everyone around them to take the news and the extra work in stride,” says Piyush Patel, author of Lead Your Tribe, Love Your Work: An Entrepreneur’s Guide to Creating a Culture that Matters. While transparency is key, you’ll want to focus less on the negatives and more on the positives. Leverage this as an opportunity to bring your team back together, understanding that additional tasks may fall onto your employees as a result of the loss.

    Don’t fire employees by yourself

    It’s also a good idea to have another person, such as an HR representative, in the room to serve as a witness when terminating an employee. There’s always a chance that your former employee may try to accuse you of an unjust firing, such as age discrimination. Having an HR representative in the room can help you stay on track and avoid any potential legal issues.

    Severance pay

    While post-termination severance packages are most commonly associated with executives, they have now become more widely extended to long-term employees. According to a Manpower Group survey, 75 percent of companies have a formal severance policy in place because “severance is one of the keys to ensuring a difficult action has the best possible positive outcome while speeding the return to productivity, profitability, and employee engagement.” Offering severance pay can also help you show appreciation for a long-term employee’s loyalty to your company.

    Terminating a long-time employee may not be enjoyable, but it’s important that it’s done legally and gracefully. Need help creating a termination policy or managing employee performance? Contact GMS today to learn more about our employee performance management services.

  • So you have that “bad apple” employee that you have to get rid of. He’s a pain in your side. Your management team spends an inordinate amount of time dealing with him and frankly, his co-workers don’t like him either. Sounds like a no-brainer, right?

    Wrong.

    When letting an employee go for cause, you need to make sure that you’re protecting yourself from the liability of:

    1. An unemployment claim that will drive your unemployment insurance up, cutting into your margins or putting you in a competitive disadvantage with your competitors
    2. A potential discrimination lawsuit filed by the employee
    3. A possible violation of either the FMLA or ADA that will have the federal government breathing down your back

    How do you avoid these pitfalls? As with all things, there’s an easy way and a hard way.

     

    Picture of a rotten apple. Think it's easy to fire bad employees? Make sure you're protecting yourself from employer liabilities.

    The Hard Way

    You do have tools that are available to you. According to a recent National Law Review piece, the three most underutilized tools to protect employers from liability are: the extra step, job descriptions, and the gut check.

    These harken back to the proper documentation and making sure that a systematic process is followed before terminating an employee for cause.

    That brings us to the definition of the “hard way”. You have to make sure that you have accurate, up-to-date job descriptions in place along with an established, documented protocol that you follow. You can easily address all of those things during your downtime (evenings, early mornings and weekends).

    The Easy Way

    The easy way is to find an inexpensive and cost and time-efficient way in managing your unemployment. The most efficient way of handling these things is through the use of a PEO (Professional Employer Organization). PEOs can look at your operation and put together a comprehensive employee management plan that protects you, your employees and helps reduce employee cost and liability.

    To learn more how a PEO can help your business, contact us today.

  • Thanks to technological advancements in the modern workplace, remote work, or work-from-home (WFH) jobs have become increasingly more common. According to the Global Workplace Analytics’ analysis of 2018 American Community Service data, work-from-home jobs have grown 173 percent since 2005—11 percent faster than the rest of the workforce. Remote work has likely grown even more so as a result of the 2020 outbreak of COVID-19, which prompted many employers to shift to a remote work model to limit the spread of the coronavirus. 

    Telecommuting can be an attractive work option for both employees and employers. For employees,  flexible work hours and more time to spend with family can make remote work an ideal situation. For employers, hiring remote workers can save money and increase productivity if you manage your remote team effectively. 

    As more businesses implement work-from-home policies, employers will need to consider how the trend will impact HR initiatives. Here are some best practices for managing HR for remote employees.

    A small business employee working from home.

    Remote Employee Performance Management

    How do you manage an employee that you don’t see face-to-face every day? With technology and some effort, it may not be as hard as you think it is. In fact, some evidence shows that working remotely can improve performance. 

    According to the Society for Human Resource Management (SHRM), “77 percent [of employees] reported greater productivity while working offsite.” In addition, the article cites a U.S. News & World Report story that states “Telecommuters log five to seven more hours per week than non-telecommuters” With good management, remote employees can be a boon for business.

    Of course, this can all depend on making sure that proper employee performance management practices are in place to monitor performance and make sure that employees stay engaged. In terms of monitoring performance, timesheets or online time tracking can help you keep track of employee productivity.

    It’s also good to set up phone or video check-ins to see how they’re doing (but not so often that it feels like they’re being micromanaged). In addition, regular facetime can help remote employees feel like they’re a part of the company.

    While telecommuters can have flexible schedules, it’s a good idea to make sure that part of their schedules overlap with office workers and that they work together via Skype, Zoom, Slack, or other communication programs. 

     

    Payroll for Remote Employees

    Managing payroll can be a complex and time-consuming task for any business owner. However, remote employees might be subject to different payroll regulations and laws depending on where they’re located. Each state, county, and even city can have its own stipulations on how much people are paid and how it happens. This can affect multiple aspects of payroll compliance, including:

    Employers must also find a way to display federal and state labor law posters for remote employees. You can electronically share the posters via email or in an employee online workplace portal, or you can mail copies for the employee to keep.

    In addition, employers need to be aware of any state requirements for the reimbursement of business expenses that remote employees may incur, such as Internet access from a home office. Where the expense may be used for business and personal use, such as having a stable WiFi connection, consider a system to help employees monitor and record how much of the cost is related to business activities and reimbursing employees at least that amount.

    Nobody wants to be hit with costly non-compliance penalties, especially for infractions that could be easily avoided. If your employee works in a different city, make sure that you or your payroll provider checks each state’s payroll regulations to make sure that your business is compliant.

     

    Hiring Remote Employees

    While some HR functions may be impacted more by remote work locations, the hiring process can be very similar to what it would be for anyone who works on location. Aspects of the process like creating face-to-face time for an interview, assessing skills, and determining if someone is a good culture fit all apply to remote employees as well.

    While it’s not always possible to have remote applicants sit down for an in-person interview, technology gives you a way to conduct a “face-to-face” interview. Video interviews through Skype, Zoom, and other tools allow you to still get a more personal feel for how an applicant would fit through nonverbal communication and body language.

     

    Terminating Remote Employees

    As for termination, you need to take the same precautions that you would for someone located in your office. Create a checklist of matters to address when an employee is terminated, such as final pay requirements, removing IT and security access, and retrieving any company property in their possession (if the employee has anything). If the employee is out of state, make sure to review the laws in that state. For example, final payment laws can differ, impacting what’s included in a final paycheck and deadlines for when it must be provided.

    Another item to consider is how you inform your soon-to-be former employee about the termination. Even if he or she telecommutes, it’s good to let an employee hear the news face-to-face, whether it’s for an in-office meeting or through a video conferencing tool like Skype. The latter may not be as personal, but it’s much better to let someone know about a dismissal during a video conference than via email.

     

    Workplace Safety Concerns for Work-from-Home Employees

    Even though remote employees may not work in your office, they still may be subject to health and safety regulations. The level of responsibility an employer has regarding workplace safety for remote employees is hazy. 

    According to SHRM, OSHA is on record as saying that it “will not conduct at-home workplace inspections and that it will generally not hold employers liable for at-home safety issues.” However, the article also cites attorney Alec Beck stating that “OSHA continues to maintain that employers are responsible for safe working conditions regardless of location.” 

    As a result, the best plan of action is to create safety reporting systems and policies that can help protect you and your employees. SHRM suggests the following risk management strategies to help reduce the chance of claims against your business:

    • Create an at-home work policy and disseminate it to all employees.
    • Require that remote employees create and provide evidence of a dedicated work area at home that has been set up according to your specifications.
    • Periodically follow up to ensure compliance.
    • Require employees to have homeowner’s or renter’s insurance that covers any potential equipment damage or liability.
    • Review the employer’s insurance to make sure that all contingencies are covered—including business travel incidents.
    • Make it clear that computer security issues are monitored and that employees wishing to use their own computers must have safety protocols installed.

     

    Manage HR for Remote Employees with a PEO

    It takes a lot of hard work to run a business. Telecommuting adds yet another layer of complexity to HR management, a task that already requires plenty of time and know-how. This amount of work and expertise is a big reason why many businesses turn to a professional employer organization (PEO) to help manage HR.

    At GMS, our experts can help you save time and strengthen your business through payroll management,  benefits administration, and other key functions. Contact GMS today to talk to one of our experts about how we can help your company manage remote employees.

  • Employees play a massive part in the success of your company. Of course, this also means that a bad employee can also lead to potential inefficiencies and other issues. 

    Firing an employee is a difficult reality of running a business. While the situation is unpleasant for everyone involved, there are right and wrong ways to go about the termination process. In fact, there are several steps you need to take before, during, and after you fire an employee. Here’s what you need to know to take the right route during the termination process.

    An employee gathering items after being fired by a small business owner. 

    What to Do Before You Fire an Employee

    Firing an employee is typically more than a one-day process. There are several actions you’ll need to take before you effectively terminate an employee to help protect your business and provide proper feedback. Depending on the employee, some of these steps may even help you improve their performance and save you from severing the relationship.

    Distribute an employee handbook

    Long before you plan to fire someone, you should make sure that every one of your employees receives an employee handbook. An updated handbook is an official document that makes the following details very clear for your employees:

    • Company philosophy
    • Conditions of employment
    • Company policies and procedures
    • Compensation and benefits

    Your employee handbook plays an important dual role for your business. First, it’s a great way for new hires to learn more about the rules, perks, and personality of your business. Second, it’s a compliance tool to make sure that your employees know and understand internal policies and grounds for dismissal. Having these rules in place – along with documentation that your employees have received your handbook – will help protect your business in case a fired employee tries to fight their dismissal in court.

    Review past performance reviews and feedback

    Before you decide to dismiss an employee, look back to see what type of feedback he or she has received in past reviews. If your employee has only heard good feedback and received raises that correspond with exemplary performance, a dismissal would come as a huge shock. 

    Not only do employee performance reviews give you a chance to set goals and expectations for an employee, they can also help protect you against claims if you’ve shared feedback indicating that an employee needed to improve. If there are no negative reviews on record, you may want to wait until you can provide some honest feedback. This way your employee may take the review as an opportunity to improve. If he or she doesn’t, you have evidence that both you and your employee knew of the continued poor performance so that you can back up your decision to terminate an employee.

    Document violations and give official warnings

    Like performance reviews, it’s important to have a documented history of any warnings or violations for any employee you decide to fire. Once it has become apparent that an employee’s performance is simply not up to standards, call them into a private space and give that person an official warning.

    It’s important to make sure that this warning is also in writing. While you explain why you’re unhappy with your employee’s performance, there should also be a printed document that the employee can sign so that you can place it in that person’s personnel file. You can also use a performance improvement plan that lists set goals for an employee to achieve within a set period of time (30 days, 90 days, etc.). Either of these options will make it clear exactly why the employee is at risk of losing his or her job and will help you back up your case as to why they needed to be dismissed.

    What to Do On the Day of Termination

    After you’ve taken the appropriate steps to give an employee an opportunity to improve and document reasons for dismissal, it’s time to act quickly and terminate the offending team member.

    Don’t wait for Friday

    While some situations call for immediate dismissals regardless of the day, certain days can be better than others if you can plan ahead. According to The Balance Careers, it’s generally best to try and aim for sometime in the middle of the week to fire an employee, preferably on a Tuesday or Wednesday. 

    Firing someone on a Monday can lead to the terminated employee feeling as though you wasted his or her time waiting until a new week has started. Friday dismissals leave the terminated employee to stew about the decision over the weekend. Aiming for the middle of the week can help mitigate bad feelings in an already difficult situation.

    Fire employees in person

    Firing an employee is already an unpleasant situation – don’t make it worse for the employee by terminating them via phone, email, or some other electronic means. While the experience will likely always be painful, it’s important to be as humane as possible when firing an employee. That approach means giving them the courtesy of hearing the news from you or another appropriate person at your company. 

    Not only is a face-to-face firing the right thing to do, it also looks much better than the alternative. Taking a less personal approach can leave a negative impression for other employees when they learn about the dismissal, especially if someone was friends with the terminated employee. As such, a personal approach can lessen the odds of not only bad reactions from terminated employees, but also any concerns from the coworkers they left behind.

    However, an in-person approach isn’t necessarily feasible if you need to fire a remote employee. While you may not be able to sit in the same room with these people, it’s still good to break the news face-to-face through some form of video conferencing platform.

    Don’t fire employees by yourself

    It’s always a good idea to have another person in the room if at all possible. Whether it’s an HR specialist or another employee, a second person serves as a witness. Unfortunately, there’s a chance that your former employee may try and accuse you of an unjust firing. Having an HR professional in the room can help you stay on track during the dismissal process to avoid any potential issues. Even if you don’t have an HR expert available, a second person gives you another person who can attest to your side of the story in case the former employee makes any false claims during your meeting. 

    Keep it short and simple

    When it’s time to fire someone, it’s best to avoid any small talk and get straight to the point. Tell the person directly that he or she has been terminated. Make it very clear that this decision is final and give very specific feedback as to why you and the company made this decision. 

    As you may expect, this isn’t a happy occasion and the fired individual likely won’t take the news well. However, it’s important to listen to what your former employee has to say to get a better read on how he or she takes the news. Whether they’re angry, sad, shocked, or in denial, continue to repeat the message and treat them with respect.

    This is also the time to cover next steps and what will happen involving their final pay, benefits, and other details. At this point, you’ll be able to discuss any terms for severance pay, extended healthcare, or other benefits if you choose to offer them. You can also ask the individual to sign a release of liability.

    Collect any work-related items

    Depending on your business, you may have provided your former employee with equipment ranging from small supplies to extremely expensive items. You’ll want to collect any company property from them before or during the individual’s last day, unless there’s an agreement in place to allow that person to keep certain goods. These items can include:

    • Keys or key cards
    • Laptops
    • Credit card
    • Cell phone, tablet, or other mobile device
    • Company car
    • Miscellaneous office equipment

    In addition to physical items, you also need to address passwords, codes, or any other means of company access. If certain doors at your company are unlocked by keycodes or other card or keyless means, change those codes. Likewise, either you or someone else at your company should restrict any user access and change any passwords the dismissed employee may use to access your computer network.

    Likewise, your former employee likely has some personal items that he or she will want to take home as well. If you schedule the termination meeting for the end of the day when most of your other employees are gone, the dismissed employee can gather their own possessions without as much fear of embarrassment. Of course, you may want someone there to watch just to ensure that the  employee doesn’t take any company property. You can also ask terminated employees to provide a list of their personal property so that someone else can gather their possessions and return it to them there or someplace outside of work at an arranged time in the future.

    Escort them out and end on civil terms 

    After both parties have collected all the necessary items and are ready to go, it’s time to wrap up the termination meeting. Personally walk the individual to the exit and wish him or her well in the future. The dismissed individual may not be in the best mood, but it’s good to part ways on a gracious note.

    What to Do After You’ve Fired an Employee

    While the hardest part of the termination process may be over, your job isn’t quite done. There are still some very important tasks to finish that involve updating everyone else in your team and protecting yourself in case the fired employee decides that the matter isn’t over just yet.

    Inform the office

    While it may seem easier to not address the departure of an employee, it’s best to be honest to your team. If you don’t say anything, other employees may lose trust in management and start to fear that there are more dismissals in store for the future. Word will quickly spread on it’s own, so you can shape the conversation and get ahead of the gossip with a quick message.

    Fortunately, your message to the rest of your company doesn’t need to be long and complicated. Instead simply you’ll want to focus on the following:

    • That the dismissed employee no longer works at your company
    • The transition plan for handling the former employee’s departure
    • That anyone with questions should feel free to speak to you or another relevant person

    Avoid saying that the employee was fired. It’s best to just say that the person in question is no longer at the company and shift toward the future. Also, refrain from making any critiques about the former employee. These comments may not sit well for his or her former coworkers, so it’s best to move forward.

    It’s also important to determine the right method and timing for sharing this information. If you have a smaller company or the former employee workerd with a close group of associates, an in-person company meeting is best. If your company is larger or the former employee didn’t work as closely with others, a termination email should be enough to suffice. You can also hold an in-person meeting with closer associates and follow up with an company-wide email as well if you want to break the news to a certain group first.

    Reassign duties

    Part of the transition plan for handling your former employee’s departure involves addressing how that employee’s duties will be handled in the short- and long-term future. This can involve delegating who will pick up the slack until you have a more permanent solution in place. If the employee received regular emails or calls from clients or customers, have those messages forwarded to someone else in the organization.

    You also want to be careful about how you split up these duties – you don’t want to make a good worker bitter because she or she has to do the work of two people because of someone else’s dismissal. If you plan to hire someone new or put new processes in place to ease the overall burden of these duties, let your employees know. A bit of transparency will help reassure concerned employees and let them look ahead to the future instead of dwelling on the downsides of the dismissal.

    Be prepared for unemployment claims

    If the employee didn’t sign some form of liability preventing them from doing so, there’s always a chance that they may file a claim against your business. Unemployment taxes can cost your business thousands of dollars, and a claim against your company may lead to even more financial burden. 

    Fortunately, there are ways to protect your business from the claims and unruly taxes. A combination of maintaining good company policies and record keeping can improve your chances of winning unemployment claim cases. It also helps to have a dedicated company like a Professional Employer Organization on your side that can reduce your tax risks and help you fight against unwarranted claims.

    Consider a PEO for Employee Performance and Risk Management

    The firing process isn’t an enjoyable one, but it helps to have trustworthy, experience HR professionals by your side when you do need to dismiss an employee. Group Management Services can help you manage the entirety of the employee lifecycle, including employee recruiting and training, performance management, and unemployment claims management.

    Whether you’re dealing with employees, benefits, or payroll, HR management can eat up the majority of your schedule. GMS can help you take your time back while providing your business with professional services that protect and strengthen your business. Contact GMS today to talk to one of our experts about how we can help you support your business.