No one really enjoys letting people go. For businesses, it really is the last resort. A smarter and more cost effective avenue is to try to improve their performance.
That being said, if the case for dismissal is undeniable, then there are significant emotional and legal considerations that should be addressed, or else you risk a very costly dismissal process.
The direct costs of an unfair dismissal process include:
• Time consumed in representation in the industrial Relations Commission and/or courts.
• Financial costs of legal representations
• Impact on the performance of existing employee
• Overtime associated to carry out the duties of the ex-employee
• Damage to the reputation of the company
Research has shown that the vast majority of unfair dismissal cases could have been avoided had the dismissal process been handled more professionally. Case studies show that most difficulties arise from poor communication and practices.
The following is a checklist to assist you through the process.
Even should you not encounter an unfair dismissal case, the impact on your team can be VERY significant. We find in recruitment, once one person moves on, their friends start considering their options as well.
1. Do not delay
Most employers take way too long to make the decision or they wait until the problem is so severe that everyone is in agreement that the person must go. Not only is this devastating to the employee who is terminated, but it also usually results in less confidence in leadership with the remaining employees. Good performers, in particular, don’t like when management tolerates this type of behavior. They see management’s failure to deal with these situations as making their work more difficult. Good performers are often called on to take on tasks that poor performers don’t get done or do poorly. It is most likely that your employees were aware of the problems you have and even though they may of liked the ex-employee; they will respect what you have done.
2. Which day?
There’s little consensus from experts about when to deliver such bad news. Some say Friday, because there’s the weekend to recover. Others say Friday leads to two days of withdrawal and depression, or worse.
3. What time?
Some suggest midmorning, so the employee can head out to lunch and get support from friends. There’s the end of the business day, so he can leave quickly without causing undue gossip. Everyone agrees about one thing: Firing someone first thing in the morning is never done for the sake of an employee. It’s always so the boss can get the burden off their chest.
4. Prepare a script
Make sure that you are clear of the main points that you want to cover in the meeting. The reason for any termination is important, of course. On 18 Dec 1998, new regulations came into force that significantly change the operation of Australian unfair dismissal laws. Before making the decision, get advice from a human resources expert or employment lawyer. You don’t want to fall afoul of state or federal laws or stray far from company policies, whether set by past precedent or formally laid out in a handbook.
5. Ensure you have all the facts documented
A “three strikes and you’re out” policy for terminating employment no longer applies in Australian workplaces. Employers alleging poor work performance or misconduct must follow specific requirements set out under the dismissals legislation. Provide written documentation to the employee that outlines the alleged poor work performance. All areas of dissatisfaction should be recorded, with appropriate levels of agreed performance provided. Allow the employee to respond to the allegations. Record all agreement (and disagreement) in writing. Allow the employee a reasonable period of time to improve in the areas required. This time frame should also be recorded in writing. The employer should be seen to be making every reasonable effort to assist the worker in the areas of work difficulties. If work performance has not improved to the specified levels by the agreed date, another written document should be sent to the employee. At this stage employers may stipulate another time period for work improvement – it must be stated at this time that if performance does not meet the agreed level (within the new time frame), employment may be terminated. If the agreed levels of performance have not been met by the final period, employers may choose to terminate the employee. Ensure you have these details before proceeding to the meeting.
6. The meeting
Ideally you want the employee to resign. This avoids the chances of unfair dismissal cases. Phrases along the lines of “you are not really enjoying yourself here are you?” and references to how their lack of enjoyment impacts on their life important people around them work only when in its obvious to everyone.
7. “Its no surprise…”
If the company must cut staff, managers ought to have prepared employees. If it’s a performance concern, this meeting certainly should not blindside an employee.
8. Get to the point within 10 minutes
Failing them wanting to resign, there should be no small talk at this meeting. Don’t try to pretend it’s an ordinary exchange. You’re only delaying the blow. Later, when the employee relives the conversation (and he or she will), any gratuitous comments will provide ammunition for deeper resentment.
9. Don’t patronize
Candidly and carefully explain the reasons and still offer sympathy. “Respect the person enough to talk business. This is a business decision and it was for ‘whatever’ reason. You are taking away a person’s job. Don’t rob them of their dignity as well.
10. Be calm
Even if the employee you are firing irritates you, don’t let on. If he or she lashes out verbally, don’t get excited. Soon this person will be gone and will no longer be your problem. If the employee wants to talk or argue, hear them out. Don’t argue back. Firmly repeat your honest reasons, your final decision, and your sincere sympathy – then politely show them out.
11. Be humane
Treat the employee you are firing as kindly as possible during the termination process. This is a very traumatic experience for them. Being kind, without conveying anything positive about their job performance, can assuage this trauma. And, of course, it can decrease the odds that someone will bring a wrongful firing suit against your company or place negative phone calls to your remaining staff.
12. Extending Support
Unless you plan to be a solid reference or you’re willing to make calls on the employee’s behalf, don’t offer help. It’s a dangerous and false sentiment. You’re belying the message you’ve just delivered, which may give the employee grounds for legal or other appeals. If you do extend support, such as outplacement services, be sure and place a time limit on any help offered.
13. The deadline
Be clear about departure: “We’ve made the decision and this is your last day,” or week or whatever’s appropriate. This also avoids security issues. Ensure all keys are returned and change passwords ASAP.
14. The final pays
Having their final cheque ready at this meeting will soften the blow considerably. If this cannot be sorted out, at least the amount due and the process to attain the payment will assist. It is best usually to have the ex-employee of site as quick as possible, rather than have a de-motivated employee affecting your team. If you give severance and you don’t have to, ask for something in return. Companies often request that employees sign waivers of their legal rights in exchange for extra pay, commissions, outplacement or any other discretionary severance.
15. Cover yourself with paper!
A full written (and dated) document should be issued to the employee stating the reasons for the decision. Get them to sign it, even better ask them to sign a resignation form.
16. Ending the meeting
When you have ended the meeting, don’t rush the employee out the door. A good idea is to offer the employee the chance make arrangements for keeping in touch with co-workers, if they so wish. It is interesting to know that most legal actions have arisen from the employee’s resentment of how he or she was treated during the termination meeting. Think of the person’s feelings and try to end the meeting on a positive note.
17. Crisis management
If people trust you, even the employee’s closest friends will eventually respond appropriately. Don’t try in any way to keep your employees from communicating with your ex-employee. This will work against what you want to happen, because it will give the terminated employee a platform. They will be able to put doubt in their minds about you and your motives. They might say things like, “Why doesn’t she want you to talk to me? What is he trying to hide?”
18. Motivating Staff
Right now your staff’s level of security in their role has been subconsciously challenged. This is one of the bottom rungs in Maslov’s triangle hierarchy of needs. What is required now is a sense of belonging and self-esteem to motivate your existing employees. Now is the time to be particularly attentive to even the smallest accomplishments among your remaining employees. This will help create a positive atmosphere that will counteract anything negative the terminated employee might be saying. One word of caution: Don’t overlook poor performance of others during this time, as this will fuel his case of unfair treatment. Be vigilant for opportunities to positively reinforce good work habits and good performance, but don’t hesitate to apply negative sanctions when the behavior warrants it. No one else on staff should be surprised about job cuts, either. Let other employees know about the termination – expeditiously, especially if there’s more than one. Communicate the reasons without rancor or confidential details. People will want reassurance about their own jobs and the state of the company.