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When to Fire an Employee

Monday, January 30th, 2017

Anyone who has ever had to fire someone can tell you that it’s one of the hardest things you will ever do, inside and outside the work environment. Knowing that the employee could react badly, with either anger or devastation, causes major trepidation. And also, recognizing the effect this termination will have on innocent people, such as the employee’s family, can make it that much harder. But, keeping a bad seed around only because you are afraid of firing the, will have long reaching effects on everyone else and hurt your bottom line in the long run.

But when is it time to let someone go? The following situations are usually not repairable, and as an employer you can’t afford to keep these employees around.

When they damage company culture.

Regardless of talent and functional performance, when an employee’s values and personality don’t fit with those of the company, it is better to find a more fitting candidate. In the book, Howard’s Gift: Uncommon Wisdom to Inspire Your Life’s Work, the authors outline a ranking system to help identify culture stinkers and helpers.

Stars are the employees we all love. They contribute and support company culture by “doing the right thing” the “right way.”

High potentials are those whose behavior we value, who do things the right way but whose skills need further maturation or enhancement. With training, time, and support, these people are your future stars.

Zombies fail on both counts. Their behavior doesn’t align with the cultural aspirations of the organization and their performance is mediocre. They are the proverbial dead wood. But their ability to inflict harm is mitigated by their lack of credibility. They kind of blend in, don’t add or subtract, and get by. These employees often get shuffled around until they retire or leave on their own.

Vampires are the real threat. These employees perform well but are at cross-purposes with desired organizational culture. Because their functional performance is strong, they acquire power and influence. Over time, the vampire’s talent and charisma attracts other employees, especially the zombies, and they all begin to act counter to the company’s culture.  Then, just like in the best horror movies, you have an army of vampires and zombies “attacking” the stars and high potentials, possibly effecting their performance and growth.

When they have a bad attitude.

We recall the personal experience of a manager at a local municipality. He had an employee who spoke negatively about management, complained about his workload, and spoke with thinly veiled contempt in meetings. Because he wasn’t dealt with expeditiously, he eventually blew up in a staff meeting, cursing at one of the managers and threatening him. He obviously was fired, but his attitude lingered in his co-workers. They had identified with some of his complaints, and his exit made him look like a martyr. It took months to get the other employees back to a place of contentment and high production. Deal with an employee like this early.

When they consistently underperform.

Always take into consideration the circumstances before firing an underperforming employee. Divorce, death in the family, physical or mental illness, and a host of other problems can inhibit an employee’s performance. You should have some compassion here, as long as it doesn’t go on for longer than a few months.

However, if you have an employee showing repeated underperformance over the course of a year or more, it’s time to evaluate the value of this employee to your company. If you have a fleet of rowboats, and one has a hole in it, your rowers will have to stop and take time to bail water out of the faulty boat. They can’t focus on their own work for long, and eventually they will get irritated and worn out.

Some states require that you make a performance improvement plan before letting someone go. However, even if your state doesn’t require it, a plan like this shows you care about your employees and their jobs. Often, the employee is just in the wrong position, and will perform better in another role or on another team. Include goals and objectives for the employee to reach within a clear timeline. Let him or her know that if the plan is not successful, the consequence will be termination. A truly committed employee will take the plan seriously and make change. If not, it’s time to end the relationship.

Jack Welch’s famous ‘rank & yank’ system is a popular methodology. Here, you have managers group their employees into three categories: the top 20%, the middle 70%, and the bottom 10%.

Welch said, “The middle 70 should be given coaching, training, and thoughtful goal-setting, with an eye toward giving them an opportunity to move into the top. Keeping them motivated is the most difficult part of the manager’s task. You do not want to lose the vast majority of your middle 70 — you want to improve them…As for the bottom 10 percent, there is no sugarcoating this. They have to go.”

Performance ranking is not always the best way to run your company, but it’s proven somewhat successful for some. Consider all your options before developing a ranking strategy. 

When they are rebellious.

Rebellion is defined as someone who openly disobeys instructions and commands. There is little room for mercy when one of your employees displays a rebellious attitude. For example, you hire Jim, an account manager. You spend a few days teaching him the ropes and introducing him to the team. After a week or so, you give him a task and he responds by openly claiming that that task is not in his purview. He thinks it belongs to someone else. Then, the next day he emails another employee and assigns the task to her, without your approval or go ahead. He might be able to explain his decision and it might even make sense, but his rebellion is now obvious to you, to him and to the other employee. This behavior creates chaos and weakens your position as a manager and leader. It must be dealt with swiftly.

When they upset customers.

If you don’t have customers, you don’t have a business. Customers can be unreasonable and demanding, but you should expect your employees to work hard to make all your customers happy. If there is an isolated incident, where an employee who is usually excellent with customers but seems to have upset one, you should investigate and see where the fault is. However, a consistent pattern of customer alienation due to the treatment of one of your employees should have your attention.

Warren Buffett always hated firing employees, yet he said, “Lose money for my firm and I will be understanding. Lose a shred of reputation for the firm and I will be ruthless.”

While firing is a difficult thing to do, it is often in the best interest of everyone involved to part ways before the situation just gets worse. Many times there’s a feeling on both sides that the job is not the right fit, and moving on to a new position can be a relief for the employee. Do the hard thing and choose what is best for your company and employees in the long run.

 

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