When you’re a business owner, eventually you’ll have to decide whether it’s best for all to fire a problem employee. You have to protect your small business. Though a termination is a tough decision, keeping problem employees can drain a small business owner’s time, money, and energy. But how do you know when it’s time to let an employee go?
Here are five telltale signs that it’s time to fire someone, plus what to watch for when you’re serious about terminating an employee.
They’re Always Late
This employee is always late getting to work and often takes extended breaks and lunches. Though they always have an excuse, their behavior may cause negative ripples in your business because they’ll be seen as unreliable by your other staff members. Even worse, other employees may believe this individual gets preferential treatment if their habitual lateness isn’t disciplined, which may lead to even bigger headaches for you as the boss.
They’re Often Absent
Constantly requesting last-minute sick days, or quickly using up all allowable sick days and vacation days could signal an attendance issue. This, combined with other issues, could indicate a potential termination.
Or maybe you have a “vanishing” employee. You know the one whose productivity decreases while his or her unexplained absences increase. This employee could be looking for another job, and attending interviews while you are paying for their time. Again, their co-workers notice such behavior. How you deal with this individual matters to them.
They Don’t Fit Your Company Culture and Disrupt Other Staff
While an employee may have great credentials, exhibiting behavior that doesn’t align with your brand and company culture may indicate a future of continued workplace problems, plus issues with how they’re representing your business in public. And repeatedly poor behavior (inappropriate comments, loud or offensive language, etc.) that distracts others in the workplace and impacts everyone’s work performance could mean it’s time to cut them loose.
They Don’t Meet the Requirements of the Job Description
Problem employees don’t get the job done, even after completing training and probation periods . They produce shoddy work, hand in incomplete assignments, and are the cause of customer complaints. If you or other members of your team must constantly fix or finish their projects, it could be a sign that it’s time to fire them.
They’re Constantly Instigating and/or Spreading Gossip
Continually starting or spreading harmful gossip about your business, employees, customers or competition in person or on social media is another indication this employee isn’t someone you want on your team. Their dissatisfaction could become infectious, as spreading gossip may contribute to a negative workplace atmosphere and less-than-professional reputation for your business both online and off.
Before Terminating An Employee
Before firing anyone, consider talking to a legal expert. Government regulations on dismissing employees are complex, and the last thing you need is a time-consuming and expensive wrongful dismissal suit. If you suspect the employee you’re about to terminate could accuse your business of firing them because of age, sex, religion, disability, nationality, or race, get legal advice before proceeding.
Firing an employee could be the hardest thing you’ll do as a business owner. But remember, between lost sales, lost time, workplace morale issues and their salary, keeping a problem employee could do more damage to your business than terminating them.
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Always tough.
Adopt new philosophy: Hire Slow, Fire Fast.
After the initial interview (phone or in person), have a team of 3 interview. Preferably 3 different backgrounds or departments. Older women are frequently more sensitive to small indicators of failure (just saying). Any one person says no, it’s no.
Not the complete answer, but a good start.
Some great advice I try to apply quarterly to our organization is this:
Ask yourself, “if a new owner took my place today, what are the first 3 things he or she would do?” If the honest answer includes employee separations, then it’s honestly past time to proceed with those separations. Of course, follow the state and fed labor laws to honor the employee and protect the organization.
Thank you for the comment!
Sally Longo it sounds like you have an independant contractor who is now claiming he was an employee. Please seek legal advice asap. You do not want to get into a legal mess because this independant contractor is angry… especially if your company is in California. Look up AB 5 that just went into effect this year.
Very informative. Thank you for sharing.
Thank you for reading!
What are the rules of letting a 1099 worker go? Doesn’t perform work satisfactorily anymore and verbalized is looking for a new job…wants more money for less work. Has left the boss in the lurch leaving work unfinished causing the boss to stay later to do the work. The boss told him not to come in if he wants to leave.
For past two weeks said he was looking for work.
Now he claims he was told he was fired.
Marius, I agree! I feel as a business owner you have to keep your mindset strong no matter what! Sometimes you have to just let go especially if your are becoming the parent instead of the boss!!
For the past several years I’ve adopted ” Slow to Hire and quick to fire” and now I talk less and sleep better. Ultimately I realized the marketplace wouldn’t care if I held onto someone or let them go, but that it would reward me if I made decisions that supported company values and standards. I want my time to be spent with the wheels that keep our bus rolling. I’ll pull over and check on the squeaky wheel once, twice and maybe even three times, but in the end who wants to go on a road trip that’s littered with pit stops?! Not me.
Great insights. Thank you for the comment, Marius!
We use the strike rules
Strike one – We have HR and the employee’s supervisor sit down to bring to the employee’s attention that there is a problem. After the meeting we have the supervisor write a letter outlining the discussion which goes into the employee’s personnel file.
Strike two – We sit down with the employee (HR, employee’s supervisor and employee’s manager) and again bring to their attention what the issue is and that the employee needs to make an effort to correct what is being discussed. At this point we have prepared an internal memo outlining the issue and discussion and have the employee, employee’s supervisor and employee’s manager sign the document. The document states that if there is one more occurrence, the employee will be terminated.
It is important to remember that you should have an employee manual/policy and reference the specific violation that occurred from the manual. Each new employee signs a statement that they have received the policy, agree to abide by the policy and that they have read and understand the policy.
Strike three – You’re out. We terminate the employee immediately and ask them to clear their personal items and are escorted off the premises.
We know it is a lot of paperwork and time, but it does save a lot of headaches should the employee file a grievance with any authority.
Thanks for the information George!
Srini,
Please see my comment to RJ – I think the same applies.
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Srini | July 10, 2019 at 8:20 pm
I have an employee who is always late and takes long breaks or on the phone. However, he brings a lot of business. The younger and newer employees learn the bad thing – but can’t match his ability to bring new business , How to handle him?
RJ –
That depends on how important “getting in on time” is. If that employee opening up your shop or restaurant and needs to be there to interface with customers and others and it’s an essential part of their job then you have to put your foot down. But if that person is doing something that more task oriented and he/she is good and profitable for your company then I think you can be more flexible as long as the job is getting done. Just make sure that you’re doing this consistently with all employees. A policy may need to be written.
Times have changed. 9-5 isn’t the same as it was before. A new generation of people want more flexibility and independence and I say that as long as they get what they need to get done on time and with quality then…why not?
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RJ | July 10, 2019 at 12:18 pm
What if you have a good young employee who just cannot get in on time unless it’s a special request. However, other than tardiness, their quality of work and attitude is stand up! Would you suggest easing up and let maturity work it’s natural course to overcoming this deficit or moving back their starting hour to accommodate and remove the obstacle. If that doesn’t work then I’d agree it’s time to look and replace.
Our problem is that each of our division principals are guilty of the same and so therefore allow the employees to follow suit to protect their own wrong doing. They are even rewarded as high or higher in raises and bonuses as the employees that perform their hours and have excellent work ethics. Even though ownership is aware of this they refuse to act. What happens…we have high performers with good work ethics resigning due to the unfairness this creates and those principals claiming its because they are not paid enough.
Susan – Thanks for sharing your experience!
The timing on this article was perfect! I have hired and fired dozens and dozens of employees, but I just had to fire a guy I loved! He was funny. He was hard working. Customers loved him. Customers asked me to send him to their houses in my service business. I was pulling for the guy.
Problem? He had a complete inability to make to work on a regular basis. After several months of this, one day, after two unexplained absences in four days… BOOM…you’re fired!
The rest of the team literally applauded me. Morale improved. Scheduling improved. Profitability improved.
My life improved.
If this guy or girl is now running your Company into the ground( and you KNOW if you have this person…)…do yourself a favor…
Thank you for sharing your personal experience Clark!
The first two points here have been the biggest in my experience. Even with friends or family as employees. Attendance issues in my experience are less a sign of someone taking advantage or being an inherently bad employee and more an indicator of where their desires are. This is the most obvious sign that your employee just doesn’t want to be there anymore. Especially with friends or family that have attendance issues many feel stuck or don’t want to disappoint their friend. Having a conversation with them about their attendance revealing their desire can give them the clarity or simply permission to find a better fitting job for them.
Thanks for this insightful comment David!
I have an employee who is always late and takes long breaks or on the phone. However, he brings a lot of business. The younger and newer employees learn the bad thing – but can’t match his ability to bring new business , How to handle him?
Unfortunately, for an employer with at-will employees, it is better to fire them for NO REASON than to give a reason. Once an employer gives a reason, the employer has opened the door to disputes about that reason. Unfortunate because the fall-out is that employees get fired without really understanding why, and without any opportunity to improve or grow from the experience.
Janet – Thank you for sharing this information!
What if you have a good young employee who just cannot get in on time unless it’s a special request. However, other than tardiness, their quality of work and attitude is stand up! Would you suggest easing up and let maturity work it’s natural course to overcoming this deficit or moving back their starting hour to accommodate and remove the obstacle. If that doesn’t work then I’d agree it’s time to look and replace.
Cutting hours to fire an employee is absolutely wrong. Talk early and often to your people, be slow to hire and quick to fire is the best policy.
Jerry – Thank you for the feedback!
These ARE usually buddies of Mgmt. and they DO tend to take advantage of the company. There are 1 or 2 in every office. We have a couple here now. They apparently have Unlimited PTO and one has received a raise and a promotion. All too familiar.
Thanks for sharing Gunther!
I believe it was Lee Iacocca that once said “I’ve never fired anyone. I’ve given people the opportunity to succeed and they chose not to take it.”
Thanks for sharing this James!
I am not a legal expert, but I would think that cutting back hours just to get an employee to quit could constitute an actionable legal issue on the part of the employee against the company. If the manager takes actions trying to get an employee to quit, that could be construed as creating a hostile work environment which is not legal. It seems to me that having a discussion with the employee about their poor work, giving him/her a clear plan to improve, and documenting all issues would be the best approach. Then you have a paper trail to justify why an employee is terminated.
Thanks for the comment Tim!
Dan,
If you cut an employee’s hours, and their paycheck becomes 20% smaller, you leave yourself open to a state unemployment claim here in Texas. Also, don’t you think that the victim employee wont complain to the other employees? Better to let the employee know that they are not meeting job expectations, tell them what they need to do to improve their service. Document the conversation, and have them sign it. Your state unemployment agency probably has a class for employers regarding these topics. Send your office manager if you cannot attend.
Jackie – Thank you for sharing!
I have worked in the Heavy Highway Industry for over 30 years and had to deal with all types of Unions, for the most part pretty good to work with, but you always have that one in the crowd that disrupts everything, so what you need to do is keep an eye on this person and write them up for the same thing 3 times and then you let him go. If they do it once they will surely do it again.
Thanks Roy!
I learned after years of managing employees, that when they responded to a conversation about an unacceptable behavior by “defending and denying”, it was time to move them out. If they did not accept any responsibility, then they were not invested in improving. I decided that I was not going to spend all of my time with employees that did not want to be there while ignoring the ones that would benefit from attention to help them grow and advance.
Angela – Thank you for sharing this!
Both of the comments are common place but illegal…Cutting back hours to get people to quit is called “constructive discharge”.
Thanks for the comment Bill!
I think the advice in the article is good. I would recommend documenting all performance related discussions with employees, be fair, professional and ethical. Having a complete employee file with the documentation included will help in the event someone decides to litigate. Getting legal advice is always a good idea. How you terminate employees says a lot about your business and you as an owner/manager. Others are watching.
Thanks for this comment Jeff!
After running a business for over 30 years and having hundreds of employees reporting to me from the corporate world what I have found when making the termination decision I would ask myself why am I, 2 to 3 years late in doing the termination. I would recommend when you first think about termination just do it, follow the rules and act quickly.
Thanks for the comment Dan!
These are usually good friends or good buddies of Management or Supervisors and they tend to take advantage of the Company. The funny thing is they may get fired by another new Manager. But if there is no changes to the business these are the one’s that keep their Job and good employees are let go at Christmas time so Management can get a better Bonus at the end of the year.
Or … to effectively fire someone, just cut back their hours little by little until the can’t afford to stay. Fast food restaurants do that with their young employees all the time.