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  • How to Terminate an Employee the Right Way

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    Establishing a Termination Policy & Guidelines

    A termination policy does more than provide a blueprint for handling problem employees. By thinking through your company’s standards and expectations and then distributing them to everyone who works for you, you’re defining a key component of your business culture. In addition, you’re also creating a chain of documents that can be produced in any lawsuits over unjust terminations.

    Your documentation should include all of the communications that employees receive explaining your company’s general expectations, along with specific work requirements and policies. These start at the very beginning with the job application form. Here, the language should be neutral, business-focused, and non-discriminatory. The same is true for every job description.

    The core document should be a well-thought-out employee handbook that details your company’s policies and expectations. Specifically, you’ll want to lay out the general terms of employment, defining whether or not it’s an at will relationship and describing your efforts to maintain a safe, discrimination-free workplace.

    Then you can describe the normal review process, including how employee performance will be evaluated and what will happen if standards aren’t met. A separate section could describe expectations for professional behavior, absenteeism, dress code (if any), respect for co-workers and managers or direct reports, etc. This section should conclude with a description of behaviors that constitute grounds for dismissal.

    Finally, the employee handbook should describe the termination process, and state how the distribution of final compensation and any benefits, such as medical insurance or accrued paid time off (PTO), will be handled.

    With good preparation, you won’t find yourself trying to improvise the proper responses when a stressful situation arises with a problem employee.

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    Here are some articles you can refer to for more details about options for the different steps of the termination process.

    • Inc. has a good overview.
    • SBA provides advice on what to include in an employee handbook.
    • And it certainly makes sense to have employees sign an acknowledgement form that they have received your handbook. The Society for Human Resource Management (SHRM) has a boilerplate version here.