What You Need to Know Before Letting an Employee Go

Small-business owners commonly (and rightfully) ask, “Can I fire someone?”  and “Can I let them go whenever I want?” While these questions are important, it’s smarter to ask what you can’t do when considering letting an employee go.

What you cannot do:

• Fire someone based on a protected class (Review your own state’s regulations in addition to the federal protections)
• Fire someone as retaliation

Next, just because you can legally do something doesn’t mean it's your best choice.

In this article, we’ll discuss three main concerns small-business owners need to know about when choosing to fire an employee:

1. Unclear reasons for termination could invite discrimination claims 
2. Typically, a “three strikes you’re out” cadence is a good practice to follow.
3. You MAY terminate someone immediately for severe or egregious misconduct.

If someone feels like they were fired for no reason at all, or for a random reason they were not aware of, that can cause an employee to start wondering and questioning why they were let go. Was it for a reason not related to the job at all?  Without clear, objective understanding, a person may start to wonder.

On the other hand, if a person was made aware of your standards or expectations and then given appropriate, clear warnings that they were not meeting those expectations, they’ll be less likely to assume any wrong doing happened.

First, build a culture in your company of clear expectations, open communication, and trust (a tall task, but worth doing!).

For now, clearly state your expectations to employees—both in job performance and behavior. Then, if those expectations are not met, address them promptly and directly! 

Get in the habit of documentation. You won’t regret writing things down, ever. This is a really simple step that can prove invaluable when facing a decision to terminate someone.  

When you feel it may be time to let someone go, look back at your documentation: your archive of correcting conversations. Make sure you think about all sides of the situation: both the letter and the spirit of the law. Some work issues may be a problem of communication and not employee engagement.

It is important to be as objective as possible. When you are letting someone go, ask yourself, “Would an outside observer say this person has been treated fairly and objectively?” 

This reflection may not change your decision to fire someone, but it helps infuse fairness and objectivity into your process and decisions.

As you clearly communicate your expectations and promptly address shortcomings, what’s next? How long do you have to tolerate it?

I recommend a “three strikes, you’re out” practice for most common situations (things like showing up late, failure to follow the dress code, or forgetting a key step in a process).

If your employee does something severely wrong or inappropriate, you don’t need to give them more chances. You can simply skip the strikes and call out the employee immediately. These worse behaviors could include:

• Theft
• Harming employees or customers
• Other illegal activities

If you feel someone’s actions or behavior meets this threshold (and the action/behavior was either witnessed or reasonably confirmed), you may choose to terminate someone immediately.

When doing so, communicate plainly and objectively why this decision was made, and then write it down. Document objective facts that would be confirmed by an outside/third party.

The decision to fire someone is a big decision. It’s important to think through it carefully and document every step of the process. But know it can be done in an objective manner that is fair to the employee and allows your company to move on if the relationship just isn’t working out.

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