Firing an Employee as Painlessly as Possible

  

Wondering if you should let someone go? Ask yourself: “Knowing what I know now, would I hire this person if they landed on my doorstep this afternoon with a resume?” The answer will give you a clear message.

Maybe you inherited employees. Maybe you hired in a rush when you had a key role to fill. Maybe last year’s spectacular hire has lost their shine. Whatever the reason, no matter how much time and energy you put into hiring the perfect candidate, eventually you will find yourself having to fire someone. It is one of the hardest challenges you will face as a business owner, but once you’ve made the decision to let someone go, acting swiftly is the best course of action.

Sometimes you’re just not going the same direction. Sometimes the job is simply done. If an employee is leaving of their own accord, make sure to schedule an exit interview. Final interviews lower turnover rate, increase employee retention, and generate honest, useful feedback. Exit interviews can also promote networking, keeping the door open with the employee who is leaving for future collaboration and referrals.

A savvy business owner consciously and consistently refrains from burning bridges. Today’s redundant engineer could be the champion of tomorrow’s huge project. The IT specialist who left to start their own company may opt to return to your firm’s steady pay cheque and great benefits. A salesperson may leave, but prove to have an extensive network of top quality associates to send your way for years to come. Things end. It’s how we end them that counts.


With over 3 billion people using social media worldwide and over 80% of North Americans using a social network, an unhappy employee can cause a lot of damage. Current and former employees are likely discussing your business or your management style on global platforms, online communities, job boards and market-specific forums. Comments and feedback, whether positive or negative, accurate or totally off-base, can spread like wildfire. Employees also have a great amount of influence with friends, families and associates on social media. While business relationships don’t always work out like we had hoped, a little grace, tact and humanity can go a long way towards maintaining your firm’s reputation.

When you have to let someone go, do it as gently and honestly as possible, without apologies. Always give your people the benefit of the doubt, especially a long-standing employee. Hear them out, and if appropriate, offer any help you can provide.

That being said, the old adage ‘hire slow and fire fast’ is almost always the right way to approach a problematic employee. Delivering bad news is never easy. Think about your company, your clients, and your other employees — the ones picking up the slack and working longer hours to make up for someone else’s poor performance. It’s in their best interest too. The person you have to let go will be better off in short order as well. Sometimes people get ‘stuck.’ They are likely not happy where they are, and hopefully it will push them towards finding a career that they love.

 

A few more things to keep in mind that can make firing an employee less painful:


1. Never fire without a witness in the room. Ensure that incidents have been well documented. Talk to your lawyer directly if you have any concerns.

2. Know what you are going to say and get to it immediately. Don’t draw the conversation out any longer than it needs to be, and don’t mince words. “Mike, I have bad news, and I am going to get right to the point. You haven’t hit your quotas for three months in a row, and I have to let you go.”

3. Stick to the facts, and don’t become embroiled in an argument. It serves no purpose, and will only add fuel to the fire.

4. Have the employee’s final cheque (and severance package if applicable) ready if possible. It reassures them that you plan to conclude your relationship fairly.

5. Afford every employee the opportunity to leave in a dignified manner. “I’d be happy to walk out of here together as if it’s just business as usual. I appreciate how difficult this is, and don’t want to embarrass you. How do you want to play it?”

6. Break the news Monday morning. It would be great for you to get this over with at the end of the week, but firing on a Friday doesn’t sit well with an upset, terminated employee. There isn’t much a person can do to move forward on a Saturday or Sunday. Breaking the news on a Monday gives the employee every chance to successfully transition to another company sooner, and tends to result in less litigation.

7. Try not to fire someone just before the holidays, on their birthday or if they have just experienced a devastating event, such as the loss of a family member or spouse. This looks inhumane, even if it is justifiable, and it can demoralize not only them, but your entire organization.

8. Ensure the safety of other employees and customers with on-site security if you think it might be warranted.

9. If you need any documents signed, don’t push. Allow the employee to take them, or have a package couriered to their home. Obtain any keys, credit cards, and security items that a disgruntled ex-employee might be tempted to misuse before a cooling off period.

10. Gather your team as soon as possible to inform them of what has happened and how it will affect them. Change makes people nervous. Reassure them that there were grounds for dismissal but do not go into any details. “As some of you may already be aware, Jennifer is no longer part of this organization. If you have suggestions about how to minimize the impact of her absence, please let me know.”

 


Above all, learn from your mistakes. Take the time to implement new hiring and reference checking practices immediately. Discuss how to prevent bad hires in the future with your team, and keep them involved in the hiring process. Deal with employee issues the moment they arise as little things can quickly become big things. There will never be a good time to fire someone, but if you act quickly and fairly, you can minimize the damage and focus on moving forward.

6 Ways to Find and Keep 'A Players'

Who are A Players and why are they essential to your business?

They are ambitious, intelligent, creative, dynamic leaders who promote innovation, collaboration, and healthy competition. The top 10%. The best and the brightest. They never stop learning, and bring with them the capacity to grow with your company. They excel individually, strengthen any team, and you should never settle for less.

Mis-hires cost vast amounts in time and training, but they also cost you in ways that you may never know, at every level. A delivery person driving recklessly in a truck with your logo could cost untold millions in bad advertising. A human resources manager with an unchecked ego might not award a position to the best person for the job because they feel threatened. Any substandard employee could sabotage your business. Continuing to operate with less than stellar employees is damaging to morale, and your entire organization will suffer.

A Players elevate your business, not just in the obvious ways translating to sales, profits, and growth, but in unseen ways as well. Their presence in the community is always known. The fact that they have chosen to work for your company, above all others, inspires confidence from clients and coworkers alike, and bolsters your corporate culture.

Even if your employees aren't “costing you,” are they Peak Performers or just Average Joes? The Harvard Business Review reports that “up to 80% of employee turnover is the result of poor hiring practices & decisions.”

Taking the time to hire the right people the first time provides a solid foundation on which to build. Every A Player you add to your roster exponentially increases your company’s pool of knowledge, talent, and creativity. Seek them out, and your business will flourish.

 

Here are 6 proven ways to find and keep top shelf talent:

 

A Players have their pick of companies to work for. Why should they choose yours? While we must reward our employees fairly, the answer is not always about money. Value-based incentives such as public recognition, freedom, flexibility, and creative opportunities can be powerful motivators for this type of person.

You can attract high caliber talent by keeping your current team engaged, by offering continued education and training, and by publicly rewarding success. A Players love to learn. If your culture enthusiastically supports personal and professional growth, word spreads like wildfire. Provide top players with the tools they need. Online courses, conferences, workshops, for example, are integral to their continued success.

But whatever the carrot, it’s only a part of the big picture to an A Player. Their unwavering integrity demands that they work for a company with a vision that matches their own. So if you’ve got big dreams, talk about them.

Share your vision enthusiastically and often. Keeping it inside your head serves no-one, least of all yourself.

Very few enterprises foster excellence, but there are a handful of companies that anyone would jump at the chance to work for. Be that kind of company, and your people will do your advertising for you--the kind that money can’t buy.

Before you go looking for your next great hire, spend a little time getting clear on what you are trying to accomplish.If you don’t know what you’re looking for, how can you expect anyone else to? What will the role look like on a day to day basis? What will success look like for this person? How will your corporate culture affect your expectations? What skills, knowledge, and competencies will be necessary to not just do the job, but be spectacular at it? Specific, measurable goals that are challenging but realistic set the bar, allowing candidates to envision a pathway to their own success. 

By defining both the position and your ideal candidate, you can not only expect talented A Players to take notice, but you will recognize them when you see them as well. Hiring is difficult enough at the best of times, so anything you can do to tip the odds in your favor of finding the right candidate is worth the effort.

 

When people know that there is opportunity for advancement, they often give more than you ask of them. This holds especially true for A Players, but a vision of a compelling future and can even turn a B Player into a star. When other employees recognize excellence in the workplace, not only will they strive for it, it becomes the status quo.

If you have people with a proven track record that want to move forward with your company, help them succeed! Passing over talent can lead to resentment and dissatisfaction, whereas promoting from within strengthens your core and boosts morale. Just as your business is ever changing, and continuously growing, so must your people change and grow. Encourage them, and celebrate and reward their success.

 

Your A Players know the culture, the job, and the expectations; they wouldn't dream of recommending anyone but the best. And since “like attracts like”, consider hosting a friends and family night to facilitate introductions. Attend networking events with your team. Or offer a bonus for quality referrals. There are countless ways to utilize your existing connections to your benefit. Inevitably, incredible people surround themselves with other amazing individuals. Encourage yours to introduce you to their top quality associates, and bring them on board.

 

The old lie: “More is better.” 400 resumes to wade through from a generic help wanted ad will only compound your staffing issues. Perhaps a few of the resumes are from A Players, but the chances of recognizing them in this sea of mediocrity are a bit like finding a needle in a haystack.

The best recruiting messages repel the wrong candidates as much as they attract the right ones. Besides the usual suspects such as a great job description, and minimum qualifications and experience, postings should showcase the personality of your business, allowing applicants to see for themselves if they are an ideal fit. Showcasing your company, its mission statement, and its values serves as a beacon to the top tier talent you want to attract and helps discourage those who might not be such a good fit.. Advertise the right way, to the right people, for exceptional results.

Besides the standard recruiting platforms such as Indeed or LinkedIn, how else can you source your networks?There are countless platforms to reach out to potential stars. Just don't expect that they know you are looking for them--tell them, using every tool in your arsenal.

Ensure your presence on social media is front and center, accurately reflects your culture, and involves every A Player you’ve got. Experiment with various job boards and track your results meticulously. Where are your highest quality leads coming from? Use what works, but never stop searching for innovative ways to find your next great hire.

 

Your competitors have A Players on their payroll who would jump at the chance to join your amazing team. Make sure they know you are looking for them. Provide them with a simple, confidential avenue to approach you. Ensure that your website funnels potential first-rate hires to you quickly and efficiently. Take notice and take action when high caliber talent knocks on your door. Add them to your team if you can, or they will be your competition soon enough.

Recruiting agencies are the next logical step. If you can’t find these elusive A Players, find someone who can. Your employees are the face of your business; external recruitment can be expensive, but it is not as costly as having the wrong person representing you. Never settle for second best.

 

Above all, be a company that stands out from the crowd. Make your business attractive to potential employees and you will increasingly attract A Players to your team. By keeping your top talent interested and engaged with continual new learning opportunities, you will maintain the strong team you've invested in. Take the time to build a strong foundation with your team and watch your business grow.

THERE MAY BE MORE CASH AVAILABLE IN YOUR BUSINESS THAN YOU THINK

Find immediate opportunities in your business to save cash.

When times are tough, your business needs cash for survival. When times are good, you need cash for growth. Because cash is such an essential resource for your business, it’s important to know where to find more of it before you need it. If you wait to find financial resources until the cash flow is needed, it may be too late. This doesn’t mean that you need to keep large cash reserves sitting in a vault someplace, but it does mean that you need access to cash at all times.

Cash can be generated either inside your business from internal sources (from profits, for example) or outside your business from external resources (from investors, for example). If you can find cash within your own business there are typically fewer strings attached compared to external resources.

Profit as a Source of Cash

Your best source of new cash is profit, so naturally one of the best ways to get more cash is to earn more profit. There are a few basic ways to increase your profit:

1. Increase your total number of sales

2. Increase the size of each individual sale

3. Raise your prices

Unless your customers are particularly price sensitive, chances are you can raise your prices a small amount without a significant loss in sales volume. The trick, of course, is how much. But even a small price increase can have a greater impact on your profits than you might imagine.

Lowering Your Expenses

Another way to increase your profit is to lower your expenses. This can be done in a number of ways:

1. Buy for quality and properly maintain your supplies. When things are taken care of, they need to be repaired and replaced less often.

2. Buy cheaper. Search for the best price (without impacting your minimum standards for quality) and ask your suppliers for discounts. If you are a longtime customer or if you purchase in quantity, suppliers will often give you a preferred customer rate.

3. Cut costs, reduce waste and increase efficiency. Something as simple as turning off unneeded lights, for example, will have an effect on the bottom line. A penny saved really is a penny earned.

4. Maintain your equipment. Repairing and replacing worn out equipment can absorb a lot of cash. Properly maintain your equipment to keep it in top-notch condition for as long as possible.

5. Rent or lease instead of buying. It’s not always necessary, or even wise, to tie your cash up in your assets. Renting or leasing seldom-used equipment, for example, often makes more sense than purchasing it.

6. Watch your payroll costs. This is typically one of the largest business expenses and the easiest place to overspend. When considering the value and expense of an employee, remember to take into account the extra employee costs, such as cash bonuses, overtime wages, medical and dental insurance, staff discounts, and so on. These extras add up. In fact, the average “extra” cost of an employee is 35% of his or her salary. By no means should you pay your people less than they’re worth. However, every employee should add measurable value to your business. If they don’t, something needs to change. Be giving where you can, but expect results in return. Remember, no one wins if the business fails.

Other Internal Sources of Cash

Profit is not the only internal source of cash for your business. Cash may be found in various other places as well:

1. Fixed Assets. Cash that is tied up in assets can sometimes be more effectively utilized elsewhere. You can free all or some of this cash in the following three ways:

Sell assets — If you don’t need an asset (such as an extra vehicle) you can sell it outright and convert it back into cash.

Sell and outsource asset use — Sometimes it’s more cost effective to outsource the use of an asset. A bakery, for example, may wish to sell off an oven that is only used occasionally and outsource the baking of certain specialty items.

Sell and rent or lease back assets as necessary— This allows you to take back most of the cash tied up in the asset without losing the use of it. Property is a common example, but this can be done with almost any asset.

2. Clean out your inventory. Liquidate obsolete or slow-moving merchandise that tie up cash unnecessarily. It’s typically more efficient to purchase these things when they are required rather than to tie up cash and storage space by storing them.

3. Minimize your inventory. Monitor your inventory and keep it to a minimum. This way you can avoid unnecessarily tying cash up in inventory. If this is an issue for you, identify your current inventory turnover, then work to make it as high as practical.

4. Accounts Payable. If you hold off on paying your bills until they are due, you can temporarily conserve your cash for other purposes. If your payables are due in 30 days, for example, it’s like getting a 30-day, interest-free loan from your suppliers.

5. Accounts Receivable. When you extend credit to your customers, you are essentially making them an interest-free loan. This is one more place that your cash can get tied up when it could be better utilized someplace else. Getting cash up front or taking a deposit is the most effective way to directly fund your immediate needs. Another tactic is to shorten the payment period. If your payables are due 30 days, you could reduce it to 20 or even 15 days. Many companies offer an incentive to their customers who pay their bills right away. A common set of terms is to offer a 2% discount for payment within 10 days. Be sure to collect on overdue accounts by designing a collections system. This will keep overdue accounts from falling through the cracks, which can happen easily when things get busy.


The ultimate purpose of your business development work is to give you the power to build your business as you envision it. Financial management puts you in the driver’s seat, giving you control over this significant aspect of your business. Of course, money is not the only measure of success, but it is an important one. After all, without it you would have no business at all.

Implementing these options gives you the potential to immediately increase your business’ profit margins. With very little turnaround time you can save money and provide your business with ready cash. By tapping into these internal sources of cash, you will place your company in a better position to successfully weather the tough times and maximize its growth in the good times.

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