How to fire an employee from your small business

2 min read

Although you have spent time hiring a great team, you – like every entrepreneur – will get to that pivotal moment when you need to let some members of the team go. Either for performance reasons or to cut your operating expenses.

Terminating an employee’s appointment can be complex. When you go about it the wrong way, it may result in a disgruntled former employee instigating a hefty “wrongful termination” lawsuit. Although rare in Nigeria, a new crop of employees are becoming more aware of their rights and such lawsuits could begin to get more popular. It may also kick the steam off the sense of mission of your remaining employees.

In this article, we’ll examine how you should go about firing employees when the need arises.

1. Warn them

Talk to the employee about what issues you have observed and give them concrete examples of behavior you think should be corrected.

On an ongoing basis, you should give such employee feedback on what you think is good or bad about what they are doing. So that an ongoing performance or ethical issue is not a mystery to them or you.

2. Use probational period

Work out a plan to correct an unethical behavior or productivity quirk. You can set a specific timeframe for things to change or specific goals if it is a performance related issue.

You should document the issue to ensure you both have an understanding of what is going on and to protect yourself in the case of “wrongful termination” lawsuit.

3. Fire when there’s no improvement

If the behavior is not changing, you will need to let the employee go. Talk with your lawyer about the documentation needed to terminate an employee.

You may decide what sort of severance you want to give the employee and whether the severance is tied to e.g. the employee signing certain legal documents associated with their termination.

4. Explain the reasons for your actions to your remaining staff

Talk with the remaining members of the team about the firing when the person is gone. Explain reasons you had to let the person go. Explain why you think this is the right and fair decision for everyone. This helps your team see things from your point of view. This way, they are not worried the same fate will betide them.  

Though it may be necessary, you should consider employment termination only as a last resort. Take this drastic step only if other performance management and behavioural correction measures have not produced favorable outcomes.  

How do you handle termination of employees at your business? Tell us in the comments.


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Olumide Olayeye

Olumide Olayeye is an ardent sport lover, occasional writer and an aspiring entrepreneur.

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