Firing an Employee the Right Way

Firing an employee is the elephant in the room at any company. No one wants to talk about it, think about it, or actually do it. But sometimes, in the best interest of your business, it needs to be done. Here's how to do it right—or even better, not have to do it at all.

I once hired a job candidate very quickly. Too quickly. George (name changed) came in for the interview and impressed us. Our agency needed a developer badly, so like idiots, we just went with our gut feel and hired him the day of the interview without calling references.

George started the job, and I gave him a relatively simple assignment—integrate a Google Maps plugin with our CMS. Over the next few weeks, I checked in regularly. “How is it going?” “Do you need help?”

He gave excuse after excuse why he wasn’t finished. Eventually, our client was upset that the project was late, so I came in on a Saturday to get it done myself. (I’m not a trained developer like George said he was.) Within an hour or two of Googling, I had figured out how to get the project done and delivered it to the client.

I was ecstatic the job was complete, but I was furious with George for misleading us into thinking he had any skills as a developer. That Monday he called me because he noticed he couldn’t log-in to any of his company accounts.

“Am I fired?”

“Um, yeah.”

And that was that.

The costs of a bad hire

Thanks to TV shows like The Simpsons, people tend to associate bosses with characters like Mr. Burns, ones who relish any opportunity to fire an employee (especially that nincompoop from sector 7G). But the truth is, most employers get no joy out of firing. In fact, quite the opposite. Firing sucks for everyone involved. And yet sometimes it needs to happen.

I’ve had to fire employees four times during my ten years as an entrepreneur, and thankfully never (knock on wood) at Proposify. 

Firings always take a hit on your culture. People at your company become friends, take lunch together, go for drinks. When you fire someone, people start worrying about their own jobs and worry doesn’t lead to forward-thinking or productivity. So firing an employee should be rare and only when absolutely necessary.

It’s also expensive for your business when you consider the time and money invested in hiring and training a new employee, especially if they aren’t producing — a bad hire costs you tens of thousands of dollars

In this post, I’ll lay out my framework for knowing when to hold ‘em and when to fold 'em when it comes to firing an employee, and how to do it the right way if the situation arises.

How to avoid firing an employee from the beginning

If we had vetted George properly from the beginning, we would never have fired him because he wouldn’t have gotten the job in the first place.

Everything comes down to cultural fit and skill, and you can usually figure those out if your hiring process is solid.

Is there a cultural fit?

You need to know culturally what you stand for as a company. Culture trickles down from the founders, so when you’re still small, the company’s values reflect the founder's values. You as the owner are the persona of who you want to attract to the company.

If the founders are in the office twelve hours a day, work weekends, and are heads-down, super serious, and discourage talking or joking around, they’ll probably look for employees that follow suit.

In that case, any employee who comes in from 9:15 am - 4:45 pm, takes an hour lunch, and chats up a storm will stick out like a sore thumb and probably won’t last in that culture. She may be an amazing employee in terms of quality of work and productivity, but she’s probably better suited to a company with a more open, relaxed vibe.

If you have a culture of honesty and transparency, an employee who is closed down and secretive probably isn’t the right fit. If you have a culture of empathy and kindness, a talented asshole just isn’t going to thrive.

That’s why here at Proposify we make our culture very clear in our job postings and pay close attention to candidate cover letters, and how they interact over the phone and in interviews. I wrote more about our hiring strategy in another post.

Bottom line: you don’t have to hire people who are your personality doppelganger, but it helps if they bear a passing resemblance to you as the founder.

Do they have the skills?

People lie on their resumes all the time.

You can find out if people have the skills you need by testing them. Here’s how we test job candidates at Proposify:

• We check a developer's code samples and make them take a handwritten test in their interview.

• We send customer support reps hypothetical customer questions and scenarios to check their responses and see how they communicate.

• We threw our sales rep candidates into a group interview and made them work on a sales pitch.

• We give content marketers small writing assignments and proof-reading tests as part of the interview process.

• We ask QA candidates to sign up for our product and find some bugs.

If you want to be really sure about a candidate’s skill and fit, you could also hire them for a small freelance project before offering them a full-time position.

Check references

You MUST check references to make sure your candidate has former colleagues and employers endorsing them. Don’t skip this step.

I once had a reference for a candidate I was pretty sure I was going to hire tell me, “Joe is a great developer, he just never builds what you tell him to build. But what he does build is great.” Obviously, Joe didn’t get the job.

Handling employee behaviour or performance issues

The more people you hire and the bigger your team gets, conflicts will occur, and issues will arise. We’re human, after all.

Some people may be stubborn and closed to new ideas. Others may dominate meetings and not let anyone else speak. You’ll need to push some employees to work harder. Or sometimes someone will say something that’s out of line.

First, be a decent person

Most of the time these situations won’t require the drastic step of firing an employee. Some people just have bad days, life happens. Maybe they’re going through a breakup, or they just lost a relative. People aren’t robots and they sometimes bring their personal shit into their work life without even realizing it.

If an otherwise good employee seems off, it’s a good idea to talk directly with them. You can avoid firing people by simply treating them like people, treating them with respect. Be the leader you would want to have. You wouldn’t want to work for someone who was all business and didn’t care about you as a person, so be don’t be that leader to your employees.

It might take time and practice to acquire the skill of being a good listener and taking an active interest in the lives of your employees. People don’t need a boss or a disciplinarian; they need a coach and a mentor. If you got into the entrepreneurship game to power trip over people, you’re in it for the wrong reasons.

What is “cause” for firing?

Legally speaking, it’s very difficult to fire with “cause”. Cause is difficult to prove, and in most cases, people are fired “without cause”, e.g., they aren’t a cultural fit, or they aren’t meeting expectations.

Regardless of everything else I’ve said previously in this post, there are certain situations that should result in immediate termination.

Some of these things might include:

• Racist or bigoted statements made on social media, or in the office.

• Sexual harassment

• Theft or embezzlement

• Punching a client in the face

• Putting you in a headlock at a team meeting and playing your head like a bongo drum

Generally, extreme cases where you can just point and say, “You’re fired. Obviously.”, are rare. The situation is usually more nuanced.

Most employee issues start out by warranting stern verbal and written warnings:

• Missing deadlines without justification.

• Being openly disrespectful to you, a manager, or another team member.

• An overall lax or careless attitude to their work.

• A major screw up that puts a client, and your business, at risk.

• General incompetence.

Write down specific things the employee said or did that were problematic, and document the date(s) it happened. Then bring the issue to the employee’s attention and be clear on the specific behaviour they need to correct. Then allow them a month to see if anything changes.

If after three of these kinds of discussions the employee still hasn’t improved, or if they improved and then reverted to their old behaviour, it’s time to fire them.

The best way to fire an employee

When it comes time to fire someone, there are a few key things to remember:

Do it now

The time between knowing you have to fire an employee and actually having the conversation can be excruciating. You may get a sick feeling in the pit in your stomach, and it weighs on you, so don’t delay. Do the firing as soon as you know it needs to happen. The worst thing you can do is put it off.

The longer you keep an employee who is disruptive, disrespectful, or incompetent, the more damage they can cause to your company moral, your team’s confidence in you as a leader, your business reputation, and your client experience.

What’s the saying about that one bad apple? So get it out before it spoils your whole barrel.

Check your legal requirements

Laws differ depending on the state or province you live in, so read up on your regional employment rights. You should provide a letter outlining the date of termination. If you want them gone that day, then you need to give them pay in lieu of notice. Personally, I’d rather someone leaves right away and pay them for a few weeks. It’s easier on you, them, and everyone else.

Protect yourself

You never know if someone is going to get emotional and do something stupid when you fire them so before you break the news make sure you’ve locked them out of any software by changing their email password and deleting any accounts they could use to sabotage the company.

Preserve their dignity

Remember to act like a decent human. Always terminate the employee privately and respectfully. There’s no need to insult or denigrate them; being fired is a strong enough message. Do it in person, if possible. Firing someone over email or text is weak and lacks character.

Don’t beat around the bush

When you have the conversation with the employee you’re about to fire, don’t hum and haw and make small talk or offer false hope. You need to be clear and unconditional; it will make things easier for both of you. You’re past the point of talking it out. The decision is final and non-negotiable. Sit them down and get right to the point.

Here’s a sample of what you might say when firing an employee:

“It’s obvious from our past conversations that you’ve been having issues here at [Company]. I’m at a point where I don’t think any of this can be resolved, so I need to let you go.

I’m sorry it’s come to this, but I honestly wish you the best of luck somewhere else. I have a termination letter here for you to review at home.

It’s effective immediately, and I need you to have your things packed and gone today. I’ve already removed your accounts and changed your email password. I’m going to need your company laptop and phone back. I’ll be paying you up until [date] so [day] will be your last pay cheque.”

Sometimes the employee will understand and not require any reasons from you. They might even have been expecting it for some time and already mentally checked out.

Others may want more explanation, especially if they’ve been blindsided by the firing, but try not to talk too long about it, you’ll end up talking in circles. They likely will never accept or agree with your reasons.

Don’t forget about your team

How you communicate and manage your team after you’ve fired someone is an important part of the process. Firings aren’t only difficult for you or the targeted employee, they can also affect your whole team.

It’s important that you communicate directly with your team that you fired someone. Make sure you are clear that it was a firing and not a layoff. A firing can be seen as someone’s personal consequence, while layoffs can instil fear and insecurity in the company overall.

Some of your team may be upset, while others may be relieved that the person is gone. You don’t have to go into extreme detail, but you do need to tell them as soon as possible. You don’t want the news to spread through the office rumour mill; you need to control the message before the message gets out of control.

Take the high road and don’t say anything disparaging about the former employee, and don’t get into the details. Most people who worked with the terminated employee will already be familiar with the reasons why they were let go.

Make sure to discuss the game plan for handling the workload of the person - will it be shared by existing employees (this could cause anxiety) or are you hiring a replacement?

Explain that decisions like these are made to protect the company, the team, and everyone’s ability to do good work. Above all, be sure to reinforce your confidence in rest of the team.

Conclusion

When it’s time to let someone go, don’t delay. Putting it off because it’s uncomfortable, or you’re too busy to think about it will only damage your company culturally. A players want to work with A players, so keeping C and D players around will affect your entire company.

The fact is, growing a company means occasionally branches need to be pruned and weeds pulled out. It’s not fun, but sometimes it needs to happen. If you apply these principles I’ve outlined, hopefully it will be a rare occurrence.