3 Offboarding Mistakes That Can Hurt Your Business

Following a formal offboarding process, an HR manager notifies an employee he's been laid off

Posted on

April 20, 2022


Even if your business is mostly concerned with finding talent at the moment, know this: your offboarding process—or lack thereof—can harm your efforts if not handled properly. That’s right: your departing employees, whether leaving of their own volition or due to a layoff or termination, can impact your ability to attract quality employees, earn new business, and retain both. 

Unsure of what you might be doing wrong? Read on. If any of these offboarding mistakes sound familiar, you may want to rectify them.

3 Costly Offboarding Mistakes

1. Lacking a formal offboarding process

Using different processes for each exiting employee can put your organization at risk for legal action. Standardizing your process not only reduces this risk, but also creates confidence among your employees.

The proliferation of hybrid and remote work models has made a formal offboarding policy more vital than ever before. Stories of mass firings over Zoom have gone viral, putting more than a dent into the employers’ reputations. Better.com’s CEO Vishal Garg infamously let go of around 900 employees over Zoom and then blamed them for business failings. Instead of taking the opportunity to refine its offboarding practices, the company made another major error a few months later, accidentally processing severance payments for some 3,000 additional employees before they were informed of their terminations.

Having a strategy to deal with offboarding small to large numbers of employees, in-person, remotely, or a combination of the two, will reduce potential negative impact and make the process easier for everyone involved.

What should an offboarding process include?

  • Legal parameters for selecting employees for termination (i.e., selected class restrictions)
  • WARN Act procedures for large reductions in force
  • Assignments for who conducts the notifications
  • Places (if in-office) or technology used for notifications
  • Parameters for timing (i.e., avoid laying off an employee on their birthday)
  • A list of paperwork that must be provided and explained to the employee
  • Severance package information, such as last check, severance pay, and health and outplacement benefits
  • Processes for handling difficult reactions from employees
  • Checklist for terminating network permissions and handing in company property
  • Exit interview

2. Not being transparent about your offboarding policy

Once you have an offboarding policy, it’s important that your employees know about it. When notifying employees that they are being laid off, explain the reason clearly and be detailed when reviewing the next steps, severance package (if any), final pay, etc. 

Don’t forget about your remaining employees. They will likely feel insecure about their jobs, concerned about their former colleagues, and wondering about the future of the company. In order to keep them engaged, they need to be aware of the policy, be told the reasoning for the layoffs, and also understand how the company is helping the impacted employees move forward. Not only will they feel more confident that any departures will be handled sensitively, but also they will have more faith in your organization as an employer knowing that a plan was thoughtfully put in place.

When offboarding policies are not communicated, rumors can run rampant when layoffs occur. Your remaining staff may become unmotivated and company morale may decline. Being open, compassionate, and transparent can mitigate negative blowback occurring as a result of the reductions. 

3. Denying employees exit interviews

Just because an employee is leaving due to a layoff does not mean they won’t have important critical feedback to offer. One shouldn’t assume the feedback will automatically be blistering or emotionally charged, either. Not only has the employee earned the right to provide insight into their role, their relationship with management, and their experiences with the company as a whole, but if you don’t provide an opportunity for them to give this feedback, they may do so elsewhere. And that feedback may be shared externally on social media or sites like Glassdoor for anyone—future candidates, present employees, and customers—to see. 

Not every employee will wish to provide feedback. However, as noted above, exit interviews should be part of the formal offboarding process, and can help establish your organization as one that wants to improve and that considers its workforce an integral part of its success. Having a template for the exit interview can help make this step easier, so that anyone conducting the interview references the same set of questions. 

Mitigating Offboarding Mistakes

The offboarding mistakes listed above are easy to mitigate. A formal offboarding process only needs to be created once, and then routinely reviewed and refreshed. The time it takes to put a process in place is well worth the effort as compared to the potential risks and ramifications that can occur without one. 

Additional Resources

Severance Guide

Essential Guide to Outplacement

How Outplacement Can Protect Your Brand, Reputation, and Bottom LineINTOO’s outplacement program helps employees transition to new jobs through unlimited one-on-one, on-demand coaching from premier career counselors, resume reviews, and other career services. Learn more about how our outplacement program can benefit your company when you’re transitioning employees.

Robyn Kern

Robyn Kern is a seasoned business writer who has written in the HR, education, technology, and nonprofit spaces. She writes about topics including outplacement, layoffs, career development, internal mobility, candidate experience, succession planning, talent acquisition, and more, with the goal of surfacing workforce trends and educating the HR community on these key topics. Her work has been featured on hrforhr.org and trainingindustry.com.

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