It’s common for organizations to go above and beyond when welcoming a new hire onto their team.
You give a guided tour of the office and even provide lunch for the newest member of the department. The same time and effort should be done when an employee decides to part ways with your company. Because of this, you must have a fully built-out offboarding process so that it can be a positive experience for everyone involved.
Offboarding is the process that leads to the official and formal separation between an employee and a company, whether it be through resignation, termination, or retirement.
For those in the field of HR, think of the employee offboarding process as the exact opposite of onboarding, which is all about making sure that a new employee becomes familiar with the organization, the people, and the culture once they’re hired.
A lot goes into the offboarding process and there are various steps to take before the employee leaves. When done correctly it can be the difference between parting ways amicably and burning the bridge.
Why is employee offboarding important?
As an HR professional, it’s crucial that you understand why offboarding is so important, no matter the industry your company falls under.
When an employee decides to part ways with your organization, they will either become an advocate or an antagonist. An advocate will speak highly of your company, send new candidates your way, and remain close with employees still employed there. An antagonist won’t recommend potential candidates to apply for open positions, could badmouth you to other organizations, and generally will burn bridges along the way.
In addition, there’s always the chance that a departing employee will “boomerang,” meaning they’ll leave your organization and decide to return. The likelihood of this increases if they’ve had a positive offboarding experience.
Re-hiring former employees has some added benefits, too. For instance, it can be cost-effective, since a returning employee already knows the business, fits in with the culture, and will be more productive faster than any new hires you may be considering.
A positive offboarding experience, from a practical and business standpoint, can also be crucial when it comes to data security. If someone’s departure wasn’t voluntary, or their offboarding experience turns sour, it could result in an exiting employee deleting files or even making a client database public.
of organizations say they've experienced a data breach by former employees.
When you have an effective offboarding process, you can limit any possibilities of there being misunderstandings or miscommunication after an employee makes their next move. It’s in your best interest to have a comprehensive understanding of their experience at your company before they part ways. This will open up additional opportunities for development, networking, and growth in the future.
As an HR manager, there are three instances that you’ll experience where an employee is leaving your company that you’ll need to carry out for the offboarding process:
When an employee resigns: through resignation or after a contract period has ended
Retire: the employee has decided it’s time for them to transition out of the workforce
Layoff or firing: the company decides they no longer want that employee within the organization, whether due to personal performance or company financial issues
Each instance comes with its own set of best practices and general rules that you should follow to ensure everything goes smoothly.
When an employee resigns
If an exiting employee resigns and leaves the company at their own will, it’s important that you don’t take their decision to leave personally. You should always aim to keep it professional and kind while remaining respectful and fair regarding their reason for parting ways.
Keep in mind that since it’s the employee’s personal decision to leave, it isn’t meant to hurt the feelings of others. It’s also not a reflection upon the company.
It’s in everyone's best interest to stay on good terms after they part ways while encouraging them to join your company’s alumni group and encouraging them to remain supportive of the company and those who remain.
You can create an alumni group of former employees through LinkedIn, or a formal alumni management system. Either way, encourage them to join once they leave the company and then use the network to share company news, get feedback about your company, or ask for referrals.
Tip: Need some inspiration? Check out the alumni network we have here at G2!
When an employee retires
The same general rules and best practices for when an employee resigns also applies for when they decide to retire. However, there are a few additional best practices to follow.
For starters, you’ll want to double-check the employee pension schemes (EPS) rules to make sure you’re in compliance. You’ll also want to determine the final retirement payment for the employee, with the help of your finance or accounting team, to be sure they get what they’re entitled to.
It’s also common, once you receive notice, to gradually reduce the working hours of the employee until the day of their retirement. And lastly, consider throwing the employee a retirement party and giving them a retirement gift. Chances are they’ve been with your company for the long haul, and they deserve to be honored and recognized for their hard work and dedication.
When firing or laying off an employee
Unfortunately, sometimes firing or laying off an employee is simply unavoidable, which can make the offboarding process more difficult.
Of course you’ll want to be kind, understanding, and do it behind closed doors to not embarrass the employee. Schedule enough time for the meeting to take place so it doesn’t feel rushed. Make sure all actions taken by the company are legal, and when appropriate, tell the other members of that department that one of their coworkers was let go.
How to complete the offboarding process
It’s clear that the offboarding process cannot be taken lightly. To do it correctly, follow this employee offboarding checklist. To make it easier, we’ve broken it down into three stages: when you first get the notice from an employee, the day the offboarding will take place, and after the employee leaves.
When you get notice
In most situations, except for firing and laying off an employee, you as the HR manager, or the manager of that specific employee, will be given notice that they’ll be leaving the company. Typically, this notice is two weeks but it can vary to as long as two months in advance.
Once you receive the notice, it’s time to complete the necessary paperwork.
The paperwork you’ll need to complete may vary depending on how the employee is leaving the company, but a good place to start is:
Severance package: If applicable in the cases of termination. This may also legally state that an employee cannot sue the company at any given point.
Non-disclosure agreement: Chances are the employee has access to classified information, so this ensures that they won't share the information with any of your company’s competitors once they’re gone.
Non-compete agreement: States that the employee cannot enter into competition with another employee after their employment. This can also be signed during onboarding.
After-employment benefits document: In some cases, like if an employee is retiring, they’re entitled to certain benefits, like retirement compensation.
Lastly, you’ll need to document the responsibilities and general duties of that employee so you have a clear idea as to what knowledge and information need to be passed on before the official offboarding takes place. If you’ll be posting their position as an open job, this will help in creating a job description as to what to expect from potential candidates.
Whether someone else within their department will be taking on their responsibilities or you’ll be hiring someone to replace them, you’ll need to know all of their processes, current projects, necessary documents, and clients they’re accountable for.
Having this information will ensure a smooth transition for whoever will be taking over their role once they’re offboarded.
The day of employee offboarding
On the employee’s last day at the company, it’s crucial that you recover and retrieve all of the necessary hardware, software, contact details, and credentials from them.
Some company assets you’ll want to collect include:
Keys to the office
Access cards to the office
Work cell phone
Company credit cards
Important folders and files
Next comes the employee exit interview. While some may find this step to be unnecessary, it’s an important step in the offboarding process as it gives you the chance to listen to the employee, especially since the employee won’t feel pressure to gloss over anything that could need fixing within the company and company culture.
Some common exit interview questions include:
What improvements can you suggest to the organization, or to your department, to make it easier, more challenging, or more interesting?
Were you and your supervisor able to work together efficiently?
What kind of feedback did you relieve from your supervisor and how frequently?
How could your supervisor have helped you more in your role?
What did you like most and least about working here?
What do you feel good about accomplishing in your job and in your time here?
What factors contributed to your decision to leave?
What makes your new job more attractive than your present job?
In addition, the exit interview is a great opportunity to touch on all of the contributions and achievements that the employee achieved while with the company and further thank them for all their hard work.
We asked HR Coordinator, Alyssa Kowalczyk at Control Solutions, her thoughts on the importance of exit interviews. She shared the following: “An exit interview is valuable to any organization, no matter the industry. It helps to get feedback from the employee on how the company can improve in areas like the culture, day-to-day processes, how management is doing, what processes should be changed, additional training that could have been provided, and more."
Lastly, if the employee is leaving on their terms, or is retiring, show your appreciation for all of the hard work and dedication they’ve given to the company by throwing an offboarding celebration. This can be something as simple as work lunch or a happy hour. You can even consider going the extra mile and give them a parting gift.
After the employee leaves
Once you’ve officially parted ways with the employee, you’ll need to wipe any sensitive data related to the organization off of their personal devices and revoke all digital access rights, like to the employee portal or corporate email. Doing so ensures you’re not at any sort of compliance risk in the future, as well as protects company information from various types of breaches in data.
You can also clean their desk or personal space, especially if someone else is literally and figuratively taking their place. Finally, update any organizational charts to avoid internal confusion and remove the departing employee from payroll.
To ensure nothing gets missed on your employee offboarding checklist, consider taking advantage of offboarding software to make the process easier. These tools will coordinate all of the necessary steps while simplifying administrative work that must be done when an employee exits or is terminated.
The right software can also eliminate unnecessary paperwork and allow for better communication on both sides of the process. If the employee is being terminated, these applications can also track the progress of forms and paperwork needed for termination. Best of all, offboarding software can also capture data to help prevent future high performers from leaving your company and increase employee retention.
The good in goodbye!
While some goodbyes will be harder than others, a proper offboarding process makes saying goodbye to an employee a little easier for everyone involved. Offboarding completes the employee lifecycle for that individual at your organization, but that doesn’t mean it’s goodbye forever!
If you find yourself offboarding more employees than usual, maybe it’s time to release an employee satisfaction survey so you can better gauge your employees’ happiness.
Mara is a Senior Content Marketing Specialist at G2. In her spare time, she's either at the gym, reading a book from her overcrowded bookshelf, enjoying the great outdoors with her rescue dog Zeke, or right in the middle of a Netflix binge. Obsessions include the Chicago Cubs, Harry Potter, and all of the Italian food imaginable. (she/her/hers)