How to Fire an Employee the Right Way

The beginning of the year is the traditional time for annual performance reviews at most startups (if you don’t do them, check out Homebrew’s guide to Performance Management at Startups). And sometimes, the outcome of that review process is the decision to fire someone who hasn’t been performing or doesn’t work well with others on your team. While there’s no shortage of advice on hiring at startups, including my own, there doesn’t seem to be as much attention paid to how to fire someone correctly. Doing this well is critical because you’re dealing with a human being, someone who is likely to experience pain and disappointment when fired. And handling firing people well is also important for the remaining team’s morale and sentiments about the company. Here are some tips for making an already difficult conversation a bit more tolerable.

Own it: Sure the person you’re firing isn’t doing her job well or is a terrible teammate. But you hired her. And you saw skills and qualities in her that made her a seemingly good fit for your company. So it’s likely that part of the reason that she failed is because the systems, structures and processes you put in place didn’t work well for her. The failure is as much yours as hers. Recognizing that will help you approach the conversation with compassion and a focus on the facts.

No surprises: The person you’re firing should never be surprised. Of course, this assumes that the reason for being fired is performance and not an ethical or legal policy violation or the result of a cost reduction, in which case it might be difficult to avoid surprise.  If you haven’t been giving him feedback on his performance and suggesting ways to improve it, you haven’t been doing your job as a manager or teammate. And you haven’t been giving him an opportunity to improve and demonstrate that he is the employee you thought you were hiring. That’s a disservice to him and the company.

Don’t wing it: Talk to your lawyers. Document the prior feedback and outcomes. Plan what you’re going to say and also where (someplace private) and when you’re going to say it (avoid Fridays so you can address any concerns of your team and not let them fester over the weekend). Prepare compensation and benefits information to present in writing at the end of the conversation.   

Empathy, not apology: Firing someone is emotional for both sides, but there’s no question it’s tougher for the person being fired. Engaging in a debate about why someone is being fired or apologizing for firing him only generates more emotion. Your approach needs to be empathetic, but focused on the clear and concise delivery of the message and its finality. If you’ve done your job communicating and documenting feedback, you won’t need to explain why he’s being fired. If the person is being fired because of a cost reduction, proactively offer to provide a reference to potential employers.

Do it in person: The person you’re firing was your teammate for some period of time. She deserves to be treated with dignity and respect. Firing someone over the phone or email doesn’t properly acknowledge the risk she took in joining your startup and the effort she put into being a good employee. It can also leave her feeling disrespected and angry, which can have its own repercussions, including legal action. Firing someone in person will help you maintain a better relationship with her over the long run.

Don’t do it alone: While you want to have the conversation in person, you don’t want to be the only person in the room. Fired employees are less likely to react angrily or violently when someone else is present. That person can also verify what was and wasn’t said in the conversation if there is ever a dispute. Ideally, someone from your HR team can join you. Your HR representative may be able to present the compensation and benefits information at the end of the conversation or answer any related questions. Many startups don’t have HR staff early in their development, so opt for a founder or another executive who has prepared in the same way that you have.  

Handling firing the right way can make a tough situation a bit easier for everyone. In fact, you might be even be surprised how people may react in the moment. An employee may express relief because she knows she’s been underperforming but has been afraid to make a change herself. Or she may share her gratitude for her time at the company and the relationships she’s built. But expect that no matter the outcome, the conversation is not an easy one. Taking these simple steps will help you have a less difficult conversation and maintain a good relationship with someone who you once considered a fantastic hire.   


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