Common Termination Reasons
Common Termination Reasons

Performance

Unfortunately, there may be times when an employee is not capable of performing to the expectations established for their role. It is the manager’s responsibility to recognize when an employee is falling short of expectations, and to work with the employee to try to improve their performance before turning to termination. If an employee is being terminated for performance, it should be the final step in an open, transparent performance improvement process.

If a manager notifies HR that they would like to terminate an employee due to poor performance, it is important to ask whether or not the manager has communicated any constructive feedback to the employee or documented conversations regarding their performance. A termination for poor performance should never be a surprise to an employee. This can be avoided by working with employees directly on improving their performance; using a
Performance Improvement Plan⁠
is one option.

Violation of Company Policy

Your company policies should clearly outline expectations for employees in areas such as employee conduct, harassment, discrimination, and retaliation prevention policies. If an employee violates any of these policies, it may be grounds for disciplinary action up to termination. You will want to consider what kind of disciplinary action has been pursued in the past, and to ensure you are enforcing the same standards across the company. Consider what level of investigation needs to be pursued prior to taking any disciplinary action. As a manager, if you suspect an employee to be in violation of company policies, reach out to your HR Manager as soon as possible.

Refer to the

Involuntary Terminations⁠

process and documents, using the

Involuntary Termination Checklist⁠

as your guide.

HR and Legal should work together with the manager to determine whether or not to offer a Separation Agreement and Release (S&R), which sets out the specific terms for an employee’s separation and typically includes an employee’s release of claims against the company in exchange for the payment of money to the employee by the company. It may make sense to consider offering a Separation Agreement and Release if there is potential for a released employee to file a wrongful termination lawsuit for:

Discrimination

Retaliation

Concerns about circumstances of the exit (little to no documentation (ie. poor performance or behavior); unclear reason for termination)

In all cases, you should consult employment counsel to discuss the potential risks involved and determine the best path forward.

Position Elimination

As your business changes and grows, a certain position within the company may be no longer needed. If this is the case for a number of positions, consult the

Reductions in Force and Layoffs⁠

section. In the event that this is for a single employee, HR and the manager should work together to fully understand why the position is no longer needed. This could be eliminating a position that was tied to certain business objectives that are no longer being pursued, or an administrative role that supports an executive that is no longer with the company. HR and the manager may want to consider whether or not the person affected could be offered another role within the company, before moving to eliminate the position. The company may want to consider offering a small severance package to aid the employee with the transition.

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If it’s determined that you will offer the employee an S&R, the next step is to determine the amounts offered for cash severance, and/or benefits (either offered as a reimbursement for a number of months of COBRA, or as a lump sum to cover the costs of enrolling in COBRA). Tenure and level are often two factors considered in determining what amounts to offer a departing employee. Whatever amounts you choose to offer, you’ll want to ensure that over time you offering employees consistent amounts.

This section on

Employee Separation Agreements⁠

offers more details on how to determine if an S&R is appropriate, as well as important requirements on allotted timelines for employees to review and sign.

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