Ways to Improve Termination Process

TERMINATION quite terrifying word in the Corporate World! Lot of questions come to mind while doing this or when we listen to this.

Termination is the act of ending the Employment Contract from either party, Employee or Employer but generally the “Termination” terminology is used in the organization while ending the Employment contract by the Employer so we will further discuss in context to that only.

If we talk about improving the termination process, it’s not only taking care of the phase of termination but we should examine the entire process from joining to Exit.

Reasons for Termination:

Let’s first comprehend the Reasons for termination. In broad way, there are only two reasons due to which termination happens from Employer side:

1. Directly Related to Organization and its Performance: Downturn in business because of change in business dynamics, Organization Restructuring, Business disruption and Merger or Acquisition etc.

2. Directly Related to Employees’ Behavior and Performance: 

• Non-performance: Lack of Job Related Skills, Inadequate work performance.
• Misconduct: Integrity, Regular or persistent unpunctuality, unauthorized absence, Negligence of Duties, Fraudulent Action

Improving Termination Process

Now, let’s talk about how we can improve termination process focusing on the entire process from Joining to Exit.

At the time of Joining:

• Employee Handbook with brief on HR Policy: An employee handbook is a compilation of the policies, procedures, benefits, and expectations of the employment relationship, professional behavioral expectations, and more that guide employee actions in a particular workplace. A copy of this should be handed over to employee so that they are aware of the HR Policies and other rules and regulations to avoid the in-disciplinary issues in future to some extent.

• Code of Conduct and Ethics: There should be proper Code of Conduct defined in the organization depending on the nature of the business. It helps in maintaining the standards of business and as well employee’s conduct and also to ensure compliance at workplace. The purpose of this is to promote ethical conduct by setting tone of good governance and deter wrongdoing. It should be aligned with the values and commitment of the organization which should enforce each employee to conduct business with integrity, in compliance with applicable laws. It should include the conduct of Dealing with people within the organization as well as dealing with the clients, Legal compliance, and also Personal conduct which includes Do’s and Don’ts within the organization, Ethical Practice, Ownership and responsibility, Acts amounting to Misconduct etc. It should be readily available to all employees and moreover, a copy of this should be signed by each employee at the time of Joining so that they are bound to adhere the compliance and it should support termination also when required.

• Exit Policy: There should be proper Exit Policy defined in the organizations which clarify the company’s position on all separation related issues and also to clarify the employee about his/her position on the same. This makes employees aware of the termination process on account of non-performance and Misconduct, Notice period, Full and final settlement process etc so that It shouldn’t be surprise to them while doing the termination of employment and they should not object the process while doing it.

• KRA Sheet: Each employee should have their own Position Description OR the KRA Sheet at the time of joining which should be signed and accepted by them so that to ensure awareness of the employees on performance expectation by the organization and in case of Non-performance, it should work as evidence to discuss further on performance enhancement plan.

While on the Job:

• Performance Management System: It is important to establish the clear performance objectives by facilitating an open communication. It works towards the improvement of the overall organizational performance by managing the performances of teams and individuals.

• Quarterly/half-yearly performance review and Critical Incident Record: It regularly provides open and transparent feedback to the employees and also Critical Incident record is necessary to capture the particular incident of non-performance and in-disciplinary issues so that it works as evidence while termination and termination happens smoothly without arguments.

• Performance Enhancement Plan: In case of non-performance, before taking any action it is advised to keep those employees under PEP and should put extra efforts and time to help them to enhance their performance. The goal of the performance Enhancement plan is to help increase the performance to meet the goals set by the business at the same time it is good compliance to maintain before taking action on termination on account of Non-performance.

• Corrective Action Plan: Employee should be kept under the Corrective action plan on account of Absconding from Work, Unscheduled absenteeism, behavioral Conduct, Integrity Issue etc. Warning letters should also be issued if there is no improvement. Also proper guidelines in case of non-adherence of this should be underlined to support any termination process thereafter.

During Termination

• Enough evidences: Be prepared with the complete Documentation of Non- Performance and Disciplinary Issues with the facts to prove non-performance and misconduct against employee.

• Employment Termination Meeting: The meeting for doing the termination should be well planned according to the employee’s situation also while calling the person for issuing the termination, make sure the Line Manager of the employee is also aware.

• Fair treatment: Terminating an employee is never a welcome so whatever reason is there for termination, employee should be fairly treated and communicated about the facts. The time for discussion and issuing the letter of termination should depend on case to case basis but one has to ensure smooth termination at the end.

Recently we have seen the case of Tech Mahindra which was of course not dealt properly.

Employment termination on the account of Major Cost cutting, Business downturn, Restructuring and Merger or Acquisition etc.

Now the question is when Employment termination has to be done in mass or in phases perhaps which is a natural situation in case of business downtown, acquisition and restructuring, then how to make it less negative and less unpleasant for employees.

Can we really make Terminations less unpleasant and hassle-free?

I would like to share my views on this:

1. Facilitating them to get new job in terms of updating CV, circulating it to various Job-Portals.
2. We may provide some kind of training programs to our surplus employees to upgrade their skills or training to face interviews and increase the success rate.
3. We may advertise our redundant staffs on various job sites with a special message by employer to put this with positive note for them.
4. We may increase the notice period for 1 or 2 months in case of termination to make more acceptable on moral ground.