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Small Business Advice: When You Have to Let Someone Go


When you run your own small business, there may come an occasion when you’ll have to let someone go. It’s unpleasant and difficult, but when you’re the boss, it comes with the territory. However, this doesn’t have to be a completely negative experience for both parties. Below are tips you can follow to help make the outcome as positive as possible.

  1. No Surprises

Letting go an employee is a difficult decision warranting careful consideration. If you’re dismissing someone because of financial reasons or restructuring in your company, it can be difficult to accept but understandable. However, if you’re ending the professional relationship because of poor performance or inappropriate behaviour, ask yourself if you’ve really given this person a chance to improve. Make sure you have documentation of performance reviews, employee feedback, and evidence of conversations or warnings. The worst situation is to dismiss someone who actually thinks they’re doing a great job. Having a consistent review process reduces the risk of an employee feeling completely blindsided by your decision.

  1. End On Good Terms

Even if you’re letting someone go on account of his or her abilities, behaviour or overall performance, you should always strive to provide the individual with valuable feedback while still framing it in a gentle and positive way. Neither party will benefit from belittling the employee or making them feel like a failure. Instead, explain that their skills and talents (and make the effort to point some of those qualities out) just are not a good fit for your organization at the moment. It takes skill to be straightforward and honest while being mindful of one’s self-esteem – but it goes a long way. Remember that your reputation as an employer can be just as important as your reputation as a provider of goods and services.

  1. Listen More Than You Speak

No one can predict how an employee will handle the news of being dismissed. He or she may display a wide range of emotions. They may cry. They may want to argue. They may have a lot of questions. But most of all they will be grappling with a mix of sadness, anger and anxiety. Have a box of tissues available, but try not to engage too much in emotional conversation. Listen with patience and respect. It’s best to focus on the next practical steps to take.

  1. Never let someone go on a Friday

A frequent suggestion from HR professionals is to have your termination meeting on a Monday. If someone loses their job on aFriday, they will be much more likely to fixate on this experience over the weekend. Since most job searching is done during the week, informing them on a Monday will quicken their transition into this mode and give them new goals to focus on.

  1. Offer to write a strong recommendation letter

Unless there were significant behavioural or performance issues, it is customary to offer a strong reference and letter of recommendation. A supportive letter from you and any offers to facilitate future work will always be much appreciated. Even the discussion around a reference can inject some hope and positivity into an otherwise difficult conversation. It also demonstrates that you are not leaving this person out to dry and are interested in their personal success. It’s a positive step to take together and can offer some closure.

  1. Let them leave and come back later for their things

It’s likely that the terminated employee will be emotional and upset after being fired or laid off. Privacy will be key. It’s best to let them go home immediately (offer to call them a cab if you sense they’re too unsettled to drive) and to arrange a later time to meet them when other employees aren’t around for them to gather their things. You can also have their possessions collected and delivered to them.

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About the Author



Lendified is Canada's premier online lender for small businesses. The company was founded by former bank executives dedicated to provide businesses with fast, easy, and affordable financing. The Lendified team regularly produces blogs and guides to help small business owners succeed.

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