What You Need to Know Before Letting an Employee Go

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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:

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.

Unclear reasons for termination could invite discrimination claims

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.

So what should I do about it?

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.  


You can document events easily by sending yourself an email. No fancy programs needed. Emails are time-stamped and archived for future reference. 

Example: “Talked with John about showing up on time for his shift. He’s been late twice in the last month (Monday the twenty-sixth and Tuesday the twenty-seventh). I told him he needed to make sure to show up on time, every day.”

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.

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Typically, a “three strikes you’re out” cadence is a good practice to follow

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).

It may look something like this:

  • First strike: Remind them of the expectation previously set (or, if it hasn’t been set, do it now).
  • Second strike: Express that they are not meeting expectations previously set, show them examples of this, and let them know that next time it happens may result in termination. 
  • Third strike: Confirm that they have again violated the expectation set forth in strike two and inform them you have made the decision to let them go.

So what should I do about it?

Documentation is everything. Even if you’re unsure if you’ll need the info, write it down anyway, just in case.

  1. Track your steps.
  2. Document your conversations.
  3. Keep track of all strikes, even if you aren’t sure whether they qualify or not. 

This documentation will be invaluable when it comes time to decide whether to fire someone.

Don’t worry so much about what is or isn’t a strike in your process—your goal is clear communication and fairness. The more you write down, the more evidence you’ll have to decide if you’ve been fair and objective before moving to termination.

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All these notes I’ve taken for myself—do I need to show them to the employee at each step in the process?

Nope, you do not. Those are internal records for you to keep.  A common practice is to have, or show, a simple document or record that summarizes the action being taken. Many companies like to have the employee sign this document to confirm they received it.

You may terminate someone immediately for severe or egregious misconduct

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

So what should I do about it?

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.

Will I need to show this documentation to the employee I’m letting go?

No, you do not. Again, this is for internal record only. When you are letting someone go, you are not required to give them any written documentation or proof in the moment. You have your archived records, so you can be confident in your decision. Internal records are only required to be shared as part of an official legal proceeding like a subpoena.

Firing someone always requires care—and that’s okay

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.

Scott Ence
Written by
Scott Ence
During Scott’s 15 years in HR, he has learned the importance and power of connecting HR practices with business strategy. He has worked in different industries, from 40 employees to 2,000, identifying key elements in areas of HR that help companies succeed. He now shares his experience and knowledge with small businesses, hosting a community called “HR Team of One” for employees in small companies who manage HR tasks. It is a place to share resources, information, and support. Join the HR Team of One free Facebook group or subscribe to premier access. You can also connect with Scott on LinkedIn.
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