One could argue that one of the least desirable responsibilities of an entrepreneur is dismissing an employee. While it is definitely very necessary to dismiss an unproductive or quarrelsome employee, it is possibly the hardest to do when the employees have not displayed any negative characteristics. These dismissals may come because of financial troubles in the business, or a need to shift business priorities.
The decision to dismiss an employee should be made only after all other options have been thoroughly explored. This is because losing a job can impact the employee in a negative way, and can impact their self-image. In addition, it causes disruption to the other employees as there will be discussions about the dismissal and a general sense of unease. It also can impact the business negatively, as time and expenses must be taken to acquire and train another employee.
If an employee is considered for dismissal due to performance issues, be sure to allow the employee time and awareness to change their behavior. Have a direct and candid conversation with the employee about their performance, highlighting the areas in which they are doing well and should continue, as well as the areas that they are lacking and should change immediately to avoid dismissal. Often directly letting an employee know how they are failing to meet the desired expectations can bring about a positive change. You should also consider the fit of the job, as the individual’s skills may be better suited in a different role in the company.
If the dismissal is occurring due to economic issues, you will want to emphasize that fact. Ensure that no employee is dismissed feeling as if the dismissal is due to their performance, or that they are at fault. This will continue goodwill for your business in the community, and sometimes bring more support. You should also give the employees a fair amount of time to seek another position, as well as providing a reference where necessary.
You should also be sure the grounds for employee dismissal are outlined clearly in the employee handbook. All discussions should be documented and filed away with the rest of the employee’s paperwork. Be sure that you have grounds for dismissing the employee that are not based on bias or personal feelings. Dismissing an employee due to bias is an illegal practice and prevents a risk to your business. Dismissing an employee who could be an asset to your business in the long run provides an advantage to your competitors and is an unsound business practice.