Offboarding Best Practices That Benefit You and Employees

May 15, 2024

Someone at work packing up a box (because they’ve been fired/quit)

When was the last time you thought about your company’s offboarding policies?

A lot of attention is given to onboarding, and for good reason – it’s important to give employees a strong first impression. But a company’s last impression on an employee is equally important.

Offboarding is your chance to leave a positive last impression on your employees. Read on to learn about why offboarding is so important, what the offboarding essentials are, and how to adjust your offboarding workflow for different events.

Why is offboarding so important?

Offboarding is your last chance to leave an impression on your employee. And that last impression can contribute to your company’s reputation.

Proper offboarding isn’t just about keeping former employees happy – it can seriously minimize your legal risk and safeguard important information.

Employees leaving a company can potentially be an event full of hurt feelings, pent up frustrations, or other negative emotions. And when employees perceive some sort of wrongdoing – whether true or not – they can act out by threatening legal action. For example, an employee can claim that their employer has terminated them wrongfully.

What does this have to do with offboarding? A smooth and positive offboarding experience can help avoid the escalation of hurt feelings. In addition, offboarding that is well documented can potentially protect a company against litigation.

Another common occurrence when an employee leaves the company is that they may disseminate company information – either intentionally or inadvertently. Proper offboarding, including the timely removal of access to company information, can help safeguard sensitive information.

Offboarding is an important part of ending the employee-employer relationship, but what does it entail?

Offboarding Best Practices

Every company’s offboarding process will look different according to the size of the company, as well as the reason for the employee leaving.

Regardless of the reason, all offboarding workflows should include the following:

Manage knowledge transfer and workload management

Have you ever had an employee leave only to realize that their direct manager had no idea how the employee set up the work that they did? That’s why knowledge transfer is so important when offboarding.

The employee leaving should outline exactly how they achieve their tasks, including what technology they use, and what their workflow looks like. Ideally, this transfer should happen from employee to direct supervisor.

In an ideal world, you would have a new employee lined up and ready to onboard while you are offboarding the employee who is leaving. But as we know, things rarely line up ideally. When an employee leaves, develop a plan for who will be responsible for their workload.

Communicate early

An employee leaving is always a hot topic for gossip. And gossip has a way of spreading half-truths – not always in the favor of the employer.

To avoid any gossip, communicate the employee’s departure sooner, rather than later.

Be transparent and communicate how the departure will affect the rest of the team members. Employees may be nervous that a colleague leaving means more work for them. While an increased workload isn’t always avoidable, letting people know ahead of time softens the blow.

Conduct an exit interview

If an employee is leaving on bad terms, both parties may be quick to get them out the door. But an exit interview is always necessary, if possible.

The purpose of this interview is so you can get better insight into the manager-employee relationship.

A neutral party – such as an HR representative or operations manager – should conduct the exit interview without the employee’s direct manager present. This ensures that the employee feels comfortable saying what is on their mind.

Ask the employee for both general feedback on the company, as well as specific feedback on their experience at the company.

Examples of questions you can ask in an exit interview include:

  • Do you feel like your position accurately reflected what was in the job ad that got you hired?
  • What as a company can we do differently?
  • How did you feel about your workload and deadlines that you received?
  • How did you feel about our project and task management process?
  • Would you recommend this company to a friend seeking employment? Why or why not?

As you can tell by the questions above, an exit interview has the potential to be quite negative if you’re not careful. The employee might take the opportunity to vent about all of their frustrations with the company.

It’s very important that while you can let the employee unload their concerns, this is not the time to respond to their concerns. Do not offer suggestions, apologies, defense, or attempt to problem-solve.

To avoid an overly negative exit interview that devolves into a long venting session, ask questions that elicit a positive response as well. You can ask things like:

  • What was fun about working here?
  • What was your biggest accomplishment while working here?

An exit interview can give you great insight on how you can improve the work environment. And by giving the employee time to voice their frustrations, you’re showing employees that you are here to listen and value their insights.

Manage your paperwork and logistics

The biggest part of offboarding is the paperwork, and logistics.

Logistics such as revoking technology and building access are crucial to smooth offboarding. Which means alerting the relevant bodies – like IT and HR – immediately when you know that an employee is leaving.

You’ll also want to let the payroll team know the date of the employee’s final paycheck, along with any sort of additional compensation like termination pay. Arrangements should be made for them to receive pay without having to log into your payroll systems.

Make sure the departing employee has all of the information they need about benefits. This includes COBRA information, all of their information about retirement plans, and any other benefits. Print these out ahead of time, with instructions on how they can access their information without signing in using company credentials.

Streamline offboarding with Commonwealth Payroll & HR

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Document everything

Documenting every stage of offboarding is critical to protecting your company legally. The reason for the employee leaving should be well documented. Share this documentation with the employee.

When you provide the employee with their benefits information, final paycheck, and other compensation, you should document it so there is a record of that transaction.

Offboarding Best Practices for Different Occasions

Offboarding will look very different for an employee who is being terminated immediately, than for an employee who is retiring. Offboarding remote employees adds yet more complications.

Offboarding for termination

Terminating an employee isn’t fun for anybody, and has the most potential for bad feelings, or retaliation.

Good offboarding for termination starts with scheduling a termination meeting. Make sure that a neutral party leads the termination meeting and that the reason for termination is well documented, along with documenting any previous citations.

Termination usually involves a more abrupt exit, often with no time to train a new employee, transfer knowledge, or tie up any loose ends. Therefore, it’s important that you’re prepared to communicate the employee’s departure as soon as possible, and work with their direct manager to devise a plan for managing their workload.

When you work with Commonwealth Payroll & HR’s HCM platform, you can print out all of your offboarding documents quickly, so you don’t have to delay termination because of paperwork.

Offboarding for resignation

When an employee resigns, they typically provide at least a 2-week notice.

Make sure to use this time to arrange for the transfer of knowledge, and to tie up any projects in progress.

While there may not be enough time to help onboard a replacement, you can ask the resigning employee to review the new job ad for their position, to see that it accurately reflects their workload.

Offboarding for retirement

When your employee has been working with you for a long time and is ready to retire, you want to ensure that you honor them and mark the occasion appropriately.

When someone retires, there is typically a longer lead time available to find a replacement. If the employee retiring has worked many years for the company, they’re likely in a more senior position. Now is the time to assess if there’s the opportunity to replace their position internally, or do you need to embark on a talent search?

Whatever the solution, there should be plenty of time for the retiring employee to help with onboarding their replacement.

Retiring employees often have a wealth of knowledge, so it’s important that you’re intentional about giving them enough time to transfer that knowledge internally.

Lastly, there should be some sort of event to mark the employee’s retirement. You could throw a party, host a happy hour, or take their team out to lunch.

Remote offboarding best practices

When your employees are fully remote, offboarding happens remotely as well.

Just because you’re offboarding remotely, however, does not mean you cannot adhere to offboarding best practices. You should still provide the employee with the benefits documentation they need and conduct an exit interview.

Data security is very important when offboarding remote employees. When the employee is not there physically, it’s much easier to potentially leak sensitive information. So, when do you cut off access to software and systems?

We have all heard the horror stories of employees finding out about their termination because they are suddenly kicked out of all logins. Obviously, this can lead to hurt feelings, and leaves a bad last impression.

On the other hand, not cutting off access in a timely manner means that an employee can easily download information to their own personal devices and accounts.

The first thing you should determine is who has ownership over the devices your employee uses to get their work done. Some remote employees own their own devices, and other employers prefer to purchase devices for their employees that are then company property.

If the company does own an employee’s devices, come up with a plan for the smooth return of those devices. An employee should never have to pay to ship company devices back to headquarters.

If an employee is being terminated, then discuss with them on the call when they can expect to lose access to systems. Ensure that they have enough access to continue communication with you as needed, as well as all of the termination documents they need.

If an employee is resigning, then access to all logins should be revoked and devices returned on their last day.

Offboarding doesn’t have to be a painful process. With the right systems in place, offboarding can be a great opportunity to let an employee leave on a positive note.

Leave a Great First and Last Impression With Commonwealth Payroll & HR

Commonwealth Payroll & HR gives you powerful tools to streamline onboarding, benefit administration services, payroll, and offboarding – all on one platform.

We work together with you to find the right solution for your business, so you don’t pay for features you don’t need.

Want to find out more about how Commonwealth Payroll & HR can help you simplify your payroll and HR? Contact us to start the conversation.

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