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Employee offboarding strategy: Saying farewell the right way


Your company probably has an onboarding strategy and orientation process for new hires. But what about when employees leave your company – whether it’s a voluntary resignation, layoff or termination? Does your company have an offboarding strategy as well?

You should.

Especially with The Great Resignation lingering and the potential for widespread layoffs associated with an economic recession, being prepared with an offboarding strategy is critical.

Employee offboarding and company culture

Think about all the things you may do when new employees join your company, such as:

  • Sending them a welcome gift
  • Taking them out to lunch with the team
  • Thoroughly introducing them to the company, providing an overview of mission, vision, values, culture and policies
  • Training them in their specific role and explain the processes they’ll adhere to as part of their work responsibilities
  • Ensuring they have completed onboarding paperwork
  • Telling them about the company resources available to them
  • Showing them how to sign up for benefits
  • Granting them access to company systems
  • Distributing any necessary equipment

It’s expected that employers give their new hires a warm welcome and enable them to get started on the right note.

And yet, when employees leave their company, the feeling that so many experience from their soon-to-be-former-employer can be, “Don’t let the door hit you on the way out.”

Regardless of the circumstances in which an employee leaves, their exit should feel respectful and caring. Treat departing employees as well as you did when they joined your company. Furthermore, help to make their transition into the next step easier.

Benefits of an offboarding strategy

With a poor final chapter at a company, an employee could leave with negative views, and you’ll end up on the receiving end of a bad review or poor word of mouth among employees and prospective job applicants. Many employees stay in touch, and one departing employee’s perceptions of rude or cold treatment by the company can diminish morale among the employees who remain. They may wonder, “What does it say about the company if they treat people this way? How will I be treated when I go?”

Additionally, it’s simply the nature of company-employee separations to often be:

  • Unexpected (in the case of resignations – unless you’re attuned to your people and pick up on the signs that an employee may quit)
  • Emotionally charged (in the case of layoffs)
  • Potentially awkward or contentious (in the case of terminations)

In any scenario, having a well-established offboarding strategy to fall back on can make the process smooth, consistent and chaos free. It can bring order and stability to a situation that could otherwise be volatile and uncertain.

Lastly, an offboarding strategy is also important from a compliance standpoint. Similarly to the onboarding process, your company has legal obligations to fulfill when an employee leaves. Your offboarding strategy can help you confirm that nothing vital has been overlooked that could later cause problems or inconvenience former employees.

Offboarding checklist

In any situation in which an employee leaves, there’s a general workflow of tasks that need to happen. These items should be included on any basic checklist:

  • Have a general script in place for managing resignation, layoff and termination meetings. Be prepared to handle tough situations, including difficult conversations in remote settings.
  • Issue final pay, which encompasses the last paycheck, unused paid time off (PTO) and pending bonuses. First confirm whether you must pay employees on their last day or as part of normal payroll, according to the laws of the states in which you operate. (Remote or long-distance employees must receive final pay in accordance with the state laws where they reside.)
  • Provide state unemployment and COBRA information. (Again, the unemployment information must apply to the state where the employee resides, not necessarily the state in which your company operates.)
  • Collect company equipment, such as access badges, mobile phones or laptops. (Especially in the era of remote and long-distance work, obtaining company equipment from former employees can be more challenging. Make it easy for employees by facilitating shipping – send them a box with a prepaid return label.)
  • End access to company systems.
  • Return personal belongings at the office to employees.
  • Have a plan for how you’ll communicate with the rest of the team or company regarding an employee’s departure.

It may be helpful to have three versions of an offboarding checklist to accommodate each employee exit scenario. Beyond this basic checklist, think through the nuances of each employee exit scenario and, as a result, how some steps may differ or how there may even be additional steps to consider.

Scenario 1: Voluntary resignation

  • Even if a resignation takes you by surprise and you’re angry, remain calm. Plan for what to say – and what not to say to avoid burning bridges with employees who quit.
  • Determine what the employee’s last day will be. Usually, an employee’s two weeks’ notice is honored. However, in some specific circumstances, such as when an employee has access to sensitive company information or they’re leaving to join a competitor, it may make sense to have them leave effective immediately.
  • Conduct an exit interview. This is an opportunity to learn why the employee is leaving and what your company could have done differently, which can inform future improvements.
  • Consider how to capture an employee’s institutional knowledge, if relevant.
  • Think through how the employee will train a team member to assist with their responsibilities while you search for their replacement.

Scenario 2: Layoffs

  • Consider the timing and delivery method of layoff notices, especially to remote or long-distance employees. Once layoffs start, word tends to spread quickly through companies.
  • Determine whether you will offer a separation agreement, or severance pay, and what the terms of the agreement will be.
  • Decide whether your company will pay for COBRA or extended benefits or offer outplacement services for a designated period of time to help ease the transition.

Scenario 3: Termination

How a PEO can help

If offboarding preparation and all the associated tasks sound overwhelming, a professional employer organization (PEO) can serve as a valuable resource for businesses. As part of the diverse range of services they offer, human resources experts at a PEO can:

  • Prepare businesses for layoffs and terminations, especially those that may not be amicable
  • Guide employers through compliance requirements and advise on all documentation involved
  • Participate in layoff and termination meetings
  • Prepare separation agreements
  • Process final payments
  • Develop employee communications
  • Send out COBRA packets
  • Assist with unemployment claims

Summing it all up

At some point, employees leaving your company – whether it’s a voluntary resignation, layoff or termination – is inevitable. An employee offboarding strategy – covering all basic steps while factoring in differences for each employee exit scenario – is a must-have to be adequately prepared. It ensures that employees are treated consistently and courteously, gives you a well-organized process to rely on at a time when emotions may run high and keeps your company in compliance.

Part of being a great employer of choice is treating all employees with respect and care, both at the beginning and the end of their employment. To learn more, download our free magazine: The Insperity guide to being a best place to work.