Recognizing When It’s In The Company’s Best Interest To Fire An Employee (When It’s Not An Egregious Issue)

“Employment at will” may give an employer the right to fire an employee at any time and without reason or notice. But having the power to be so arbitrary doesn’t mean you should wield it.

If you are the one with hiring and firing power, hopefully you are more thoughtful in your termination policy and process. But are you confident that you can recognize when it’s in your company’s best interest to fire an employee?

First of all, no one should be surprised by a termination notice. If an employee is guilty of an egregious infraction and needs to be fired immediately, s/he probably won’t be surprised by the outcome.

But in cases that aren’t about egregious issues, there is always a way to fire an employee without holding his/her dignity hostage.

The more important consideration is whether terminating an employee could cause you to miss an opportunity to “salvage and save.”

If this employee held so much promise at the time of hiring, is it possible to modify the problem behavior? Is the situation redeemable enough that you can salvage the employee and save the company the cost of replacement?

There are certainly behaviors that warrant immediate, non-negotiable termination. Examples include:

• falsifying company records
• misconduct/breach of company policy (sexual harassment, criminal behavior, stealing, fraud, industrial espionage)
• drug or alcohol possession/use at work
• mutiny

In most cases, however, there will be reason to think and consider options before deciding to fire an employee.

Management will need to look in the mirror, too. If an employee’s performance and contribution to the team at large have been unsatisfactory, it’s the manager’s responsibility to identify and address the problem. Deferring it to “mind-reading” status in an effort to avoid the discomfort of correction is unfair to everyone — including the company.

The trick for you as a manager or executive is to determine the effort needed to correct the problem and save the employee. Then weigh that against the cost of replacement.

Depending on the role, qualifications and revenue power of the employee, that cost could be as high as a couple years’ salary.

If there is a performance issue, have you brought it to the employee’s attention and collaboratively mapped a plan for improvement? Has the employee acknowledged the problem, taken responsibility, and made an effort to improve? If so, then salvaging is promising.

If they’ve not taken responsibility or made a significant effort to improve or if the support, they need to improve is preventing you and/or the rest of the team from doing your own work, then it’s in the best interest of the company to let the employee go.

If the issue is behavioral, such as chronic tardiness, a progressive discipline policy may be an option. Discuss the problem with the employee and make it clear that company rules apply to everyone, regardless of his/her value to the company.

“Three warnings and then termination” allows a fair window for improvement. It also gives you the leverage to fire an employee based on the employee’s decision not to make necessary changes in behavior.

The more difficult cases to decide will be those in which an employee is affecting the morale or productivity of the whole team.

Again, you will have to start with an assessment of your own performance as a manager. Be honest about your attention to correcting problems before they become destructive. If you have been more passive-aggressive than assertive, you owe it to everyone to have an honest discussion with the employee.

You never know if something personal or health-related is undermining the employee’s performance. Perhaps there is a situation at work that s/he has been afraid to bring up.

Regardless of the reason, you will have to be prudent in deciding if there is room and time to work on correction. If the cost to the team at large is too high, termination may be the only answer.

It may also be necessary to fire an employee who has proven to be grossly incompetent for his/her role. This would be a case of an employee being “mismatched” for the job. But that level of incongruity could also call into question the judgment of the hiring manager or executive.

It’s never a pleasant or easy decision to fire an employee, even when doing so is absolutely warranted and necessary. By making sure you have solid evidence that letting the employee go will benefit the company, you’ll be in a better position to know you’re doing the right thing for everyone.

If you would like further insight into knowing when it’s in your company’s best interest to fire an employee, we can help. You can reach us here.