Employee Offboarding

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Employee Offboarding

Involuntary Terminations
Involuntary Terminations

Common Termination Reasons

Reductions in Force and Layoffs

Separation Agreements and Releases

Involuntary Termination Resources

Involuntary Termination Resources

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Involuntary Termination Checklist

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Employment Verification Letter

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Knowledge Transfer Questions

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Final Paycheck and Vacation Payout Requirements

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Knowledge Transfer Planning Spreadsheet (Leadership Roles)

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At-will Employment Overview

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Employee Separation Agreements

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Red Flags When Taking Adverse Action

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Talking Points for Managers - Performance

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Talking Points for Managers - RIF

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Termination Email Templates

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Employee FAQ Template

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RIF Sample Communication Plan

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An involuntary termination can occur for many different reasons, from poor performance, to violation of your company’s policies, to a layoff or reduction in force (RIF). A termination is involuntary when the company makes the decision to terminate, rather than the employee. Regardless of the reason, it is important to treat each termination with attention and care, and every employee with dignity and respect. This page outlines the general involuntary termination process, but use the links above to navigate to specific termination types in more detail.

📍 Start Here: If you’re on the HR or Operations team and manage terminations for your company, we recommend reviewing and making a copy of this
Involuntary Termination Checklist⁠
at the start of every employee exit process to ensure that you’re completing all steps necessary for a compliant and successful termination process.

Generally the first step of any involuntary termination is for HR to meet with the internal stakeholder(s). Depending on the scenario, this may be a manager, director or leadership team member. HR should work to understand the specific reason for pursuing termination, and get as much context as possible from the stakeholder(s) before moving forward. This may include asking for additional documentation, such as emails, Slack messages, or meeting notes, or consulting internal policies.

🚩 You should conduct a thorough review of potential

red flags when taking adverse action⁠

. If you’re unsure whether or not a red flag applies, HR should work with an employment attorney to determine the best path forward.

Even if there are no obvious red flags, HR may still want to consult with an employment attorney to assess additional risks.

Once it’s been determined that the company had decided to move forward with the termination, it’s the responsibility of HR and the manager to work closely together (with any other relevant stakeholders) to ensure a successful termination process.

Deciding on a Termination Date

Employees should be separated from employment when they are notified of the termination.

There are some circumstances when you may relieve the employee of duties upon notification and have the official termination day 1 to 2 days later. (Typically this should be reserved for situations when you need more time to issue the final check or you need some short transition period to collect information.)

It is not recommended that terminated employees be relieved of duties and “left on payroll” for multiple weeks - ie. pushing out the termination date. (This causes risk for the employer, as they will continue to be an employee of the company and any actions/behavior would be the responsibility of the employer.)

Separation Agreement and Release

After evaluating the termination circumstances, HR and the manager will determine if a Separation Agreement and Release is appropriate (this is where you would include a severance package). For more information on this, navigate to this

section⁠

1. Knowledge Transfer

The manager of the terminating employee should consider how this employee’s departure will impact their team. Are there certain team members who will need to take on more work? Does this employee own key systems, documents or tools? If they manage a team, who will become the interim manager? How might this affect team morale? While not all of these elements can be controlled for or planned in advance, considering them before the employee is terminated will help the manager and team have a smoother transition.

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Knowledge Transfer Questions⁠

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Knowledge Transfer Planning Spreadsheet⁠

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2. Offboarding Coordination

In addition to HR and the employee’s manager, involuntary departures typically require close coordination with additional stakeholders, such as Legal, Benefits, Payroll, IT, Workplace, and Operations. HR is responsible for confidentially coordinating many of the pieces involved in an involuntary termination, outlined in the

checklist⁠

and below. HR and the manager are both responsible for preparing adequately for the termination meeting, from paperwork (HR) to talking points (HR and manager) to ensure things go smoothly. HR may offer the manager the opportunity to rehearse, role play or scenario plan in order to feel prepared for the meeting. HR will use the

Involuntary Termination Checklist⁠

to keep track of all of these items. Here are some of the additional items that HR will coordinate (also outlined in the checklist):

Notify your Benefits team of the employee’s departure date

Notify your Payroll/Accounting team of the employee’s departure date, and decide who will process the termination in the HRIS

Be sure to review the employee’s offer letter and note if they have any clauses related to bonuses that may be due back to the company

Each state has different

requirements⁠

for when an employee needs to receive their final pay. Check your state’s requirements before deciding how to process their final paycheck. You may need to coordinate with your CEO to write a live check for the employee on their last day, and if the employee is remote, have it couriered to them.

Notify your IT team to shut off access, accounts and collect equipment at the appropriate time on the employee’s last day

Review the employee’s: immigration status, state of residence (in case the termination documents need to be modified), vested equity (likely will need to request from your Legal team) should an Equity Repurchase Letter be necessary

Prepare a Separation Agreement and Release (if applicable)

Prepare talking points

Schedule the exit meeting

3. Talking Points for the Termination Meeting

HR and the employee’s manager will both be present during the exit meeting. HR should provide the manager with specific talking points based on the termination. Talking points provide a clear, unambiguous script for both the manager and HR to follow when conducting an involuntary termination. The scripts below can and should be modified to suit the specific details of each termination, but provide a general flow of information, key points to include, and tips for an effective discussion.

When creating talking points remember the following:

State clearly to the employee that they are being terminated.

State clearly the reason why they are being terminated.

The manager should not engage in a back and forth with the employee, as tempting as it may be to do so.

HR’s role is to keep this meeting on track, in addition to walking the employee through the separation logistics and answering any questions the employee may have.

Resources

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Talking Points for Managers - Performance⁠

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Talking Points for Managers - RIF⁠

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4. Exit Meeting

The manager should schedule the meeting with the employee to conduct the termination. Given that involuntary exit meetings may be more contentious, the manager and HR should consider a few factors when scheduling the meeting. Ideally, the meeting occurs at a time when the fewest number of employees are in the office, either in the morning or at the end of the day. The meeting should occur in a conference room that is private and is least visible to other employees.

Another person should always be present in a termination meeting in addition to the manager, ideally HR. The manager should not add HR to the calendar invite for the meeting, but instead communicate the date, time and place of the meeting directly to HR. If in person, HR should be present in the room before the employee joins the meeting. If done remotely, the manager should notify HR when to join the meeting.

Note: If the exit meeting is remote, the manager can share the video conferencing details directly with HR to join the meeting.

During the meeting, it’s essential that the manager and HR follow pre-determined talking points, so as to not unintentionally share any information with the employee that could be misconstrued or misinterpreted, and to keep the meeting clear and to the point. Reference the talking points for different scenarios to understand how to guide a successful exit meeting, and remember to treat each employee with sensitivity and respect.

Once the manager has explained to the employee that they are being terminated, HR will go over the relevant documents for the employee to review and sign, and answer any questions the employee may have, including a

Separation Agreement and Release⁠

, if one is being offered. Once the meeting is finished, HR can either escort the employee to get their belongings and exit the office, or can collect the employee’s belongings on their behalf. Use your best judgement to determine how to approach this in the situation.

Sample Involuntary Exit Meeting Outline

Sample Involuntary Exit Meeting Outline

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5. Communication

Whether you choose to inform the company of an employee’s involuntary departure will depend on a number of factors, such as the employee’s position within the company, the employee’s involvement with key workflows, and your company culture.

We recommend being consistent and treating all employee departures, regardless of the reason, with the same confidentiality and respect. We never recommend disclosing the reason why an employee left. If the employee is departing involuntarily and you’ve chosen to inform the company or a group of employees, keep the message short and concise (e.g. “[Employee Name]’s last day with the company was last Friday. We wish them all the best in their future endeavors. You can reach out to [Manager Name] with any questions”). You may choose not to share each departure with the company as your company grows, however if the employee leaving is a member of the leadership team, or responsible for several important workflows, it may make sense to send out a broader company message. The message should indicate who will be taking over key workflows, and who can be contacted with questions.

6. Termination Paperwork

The below

forms⁠

are the basic required and recommended forms to provide to departing employees (in California).

Important Compliance Step: In order to ensure your offboarding process is compliant, review the
final pay requirements⁠
and forms your state laws may require you to provide to employees, in addition to any forms you may want to also provide as a company. Required and/or recommended forms are listed below. As your company scales, you will also want to consider how to share these forms with employees in an efficient manner.

Resources such as

SHRM⁠

, your Chamber of Commerce, your state government’s EDD website and employment counsel are all great places to check to ensure you’re staying compliant with the necessary procedures and forms in your state and county.

Offering COBRA (Continuation Benefits Replacement Act)

COBRA is a program offered at both the federal and state level that provides certain former employees, and their enrolled dependents, the right to temporary continuation of their employer-provided group health coverage.

Federal COBRA requires that employers with 20 or more employees offer COBRA coverage. COBRA coverage can extend for up to 18 months. Federal COBRA does not extend to unmarried domestic partners. An HRIS, such as Rippling, may assist you with administering Federal COBRA.

Cal-COBRA is a California mandated COBRA program, requiring that employers with 2 to 19 employees provide temporary continuation of coverage. Cal-COBRA can extend for up to 36 months (and can be used to extend health coverage to a total of 36 months for those under federal COBRA). Cal-COBRA extends to registered domestic partners.

If you work with a Benefits Broker, they can assist with ensuring you are complying with the appropriate COBRA program, and sending out necessary COBRA paperwork to terminated employees.

7. Final Steps

On the employee’s last day, collect their computer, badge, and any other company-issued equipment. If the employee is remote, provide them with your company’s FedEx or UPS account number and instructions on how to ship items back to the company (or generate a shipping label for them). Specify the amount of time you will allot the employee to return their items (e.g. 10 business days).

If the employee did not physically sign their paperwork on their last day, send it to them for e-signature on their last day. On or shortly after their last day, send the employee an email with a summary of their signed paperwork and FAQs. Upload all completed paperwork to the employee’s personal file.

If applicable, work with your Legal team to update equity vesting in Carta.

Involuntary Employee Termination Required Documents

Involuntary Employee Termination Required Documents

Document

Description

Actions

Notes

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Termination Certificate

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Reminder of the employee’s responsibility under the Company’s CIIAA Form

Employee signs

Required

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Change in Relationship Form

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California-only required form noting the change in employment relationship

CEO/HR signs

Required - if employee is in CA

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Final Paycheck Acknowledgement Form

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Employee acknowledgement that they have received their final paycheck and are not owed additional wages

Employee signs

Recommended if using a live check

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Repurchase Letter

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Letter issued when Company is repurchasing unvested shares from employee; accompanied by a check for the employee for the purchase amount of unvested shares.

CEO signs

Required - if employee was issued RSA’s

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HIPP Notice

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California-only required form describing additional benefits offered by the state that the employee may be eligible for

Employee reviews

Required - if employee is in CA

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Employee Offboarding FAQs

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General FAQs employees may have when leaving the Company

Employee reviews

Strongly recommended

COBRA Packet

Benefits enrollment packet which employee may use to elect coverage to continue under Company’s plans at a cost to the employee. This is provided by the Benefits Carriers, often via the Benefits Broker.

Employee reviews

Required

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Unemployment Packet

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Information for the employee on unemployment benefits

Employee reviews

Required in CA, and many other states

Separation Agreement and Release

A S&R 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.

Employee reviews and signs

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