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Seven steps to take when offboarding employees

Written by: Elizabeth Walker
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Published on November 16, 2022.

Many companies put a substantial amount of time and effort into creating a robust onboarding process for their new hires. But with one study1 finding that 53% of employees are actively looking for a new job, it’s just as important to develop a strong offboarding program to ensure employees leave your organization on a good note.

Employee turnover is never easy, but a successful offboarding program can help you run a smooth transition, boost your company’s brand, and supply you with valuable employee feedback.In this blog, we’ll discuss what offboarding is, why it’s important, and give you the top seven steps to take to offboard your employees effectively.

Want to retain your employees better? Our guide to fringe benefits can help boost your compensation package

What is employee offboarding?

Employee offboarding, or exit management, is the process of managing the employee experience when staff members are transitioning out of a company, whether for a voluntary resignation, layoff, retirement, or termination.

Offboarding is typically handled by the employee’s direct manager and your HR team with the goal of ensuring a smooth transition for the company, the employee, and their teammates.

You should aim to part with the employee on good terms while tying up loose ends, such as capturing any critical knowledge for ongoing projects, conducting an exit interview, and completing any relevant HR paperwork.

To stay organized, you can design an offboarding checklist to help your HR team and other managers understand what will happen during an employee’s offboarding process.

The process you create will vary based on your company policy, your organization’s size, the employee’s position, and the reason they’re leaving. Still, many of the major steps on your offboarding checklist will likely be the same regardless of these factors.

Why is having an employee offboarding program important?

Designing a structured employee offboarding program offers several advantages for a company. Not only does it help keep an employee’s exit as friendly and non-confrontational as possible, but it’s also a vital part of your organization’s employee experience and long-term success.

Here are five benefits of having an organized offboarding program:

  1. Reinforce your company’s brand: By giving employees a positive last experience at your organization, they’ll be more likely to recommend your company as a great place to work to potential customers and job seekers.
  2. Entice boomerang workers: Boomerang workers, or employees who leave and return to the same company, made up 4.5%2 of all new hires in 2021. A successful offboarding process may help workers feel more comfortable returning to your organization.
  3. Fewer security risks: When someone leaves your company, it’s crucial to close security gaps by properly collecting data, documents, and company equipment. Adding this step into your offboarding program can reduce any mishandling of sensitive information.
  4. Gain valuable feedback: The offboarding process is a great time to gain employee feedback that you can use to improve your overall organization and help you during the recruiting process to fill the open position.
  5. Reduce legal threats: You can avoid costly wrongful termination lawsuits by ensuring employee contracts are ended properly, and no one leaves your company feeling like you breached any agreements or promises.

Seven steps to take when offboarding employees

1. Understand the reason for the exit

In most cases, the employee’s manager will know the employee and their reasons to exiting best. Therefore, you’ll want to work directly with the manager to find out why their employee is leaving, so their offboarding process can be tailored appropriately.

For example, a retiring employee may have a more straightforward offboarding process than someone who’s being terminated or laid off. Similarly, the information you can gather from a worker who’s resigning to be a full-time parent will be different from someone who’s leaving for reasons related to the company culture.

In all cases, make sure the employee’s manager is closely involved in the person’s offboarding process, so they feel continued support during the days leading up to their exit.

2. Communicate the employee’s departure

While it’s sometimes uncomfortable to tell your staff about an employee’s departure, it’s best to speak openly and honestly with your team about why their coworker is leaving—whether it’s voluntary or involuntary.

Communicating the information as soon as the exit is finalized prevents gossip from spreading. The longer you wait to share the news, the more likely your other employees will fill in the gaps themselves with information that may or may not be accurate.

If an employee is leaving, communicate their last day of employment and other relevant information, such as who will take over their job responsibilities, before rumors start. It’s also important to let your remaining employees know they can come to you with any questions or concerns to ensure they feel supported moving forward.

Depending on the employee’s role, you may need to notify outside parties. For example, if the employee is client-facing, you may need to inform their clients of the transition. If the worker is in a customer-facing or public role, you may decide to share certain information with the public about their departure.

Regardless of the reason, speak about the employee with fairness and gratitude for their service at your organization. A positive departure protects you from retaliation and legal issues, and goes a long way toward cultivating a long-lasting relationship with the employee as a potential customer or business contact.

3. Complete the necessary paperwork and administrative tasks

Like the hiring process, an employee’s exit requires substantial paperwork. Your HR team can help the employee navigate any remaining administrative tasks, but you should consult with your HR and legal team beforehand to make sure they have all the necessary employee information to run a smooth offboarding process.

Paperwork and administrative tasks may include:

  • Notifying IT of the employee’s last day so they can change equipment and software access.
  • Meeting with HR to discuss any closure information for employee benefits.
  • Getting all transition documents signed, such as a formal letter of resignation and non-disclosure agreement, if applicable.
  • Requesting any applicable company property back from the employee.
  • Scheduling the employee’s exit interview.
  • Alerting payroll to the final paycheck date and processing outstanding employee reimbursements for bonuses or paid time off (PTO).
  • Reviewing the terms of the employee’s contract with your legal team to ensure all obligations have been met.
  • Working with accounting to review the employee’s compensation package and tax information.

4. Complete a knowledge transfer

When employees leave, they take their skills and knowledge of the job with them. If you don’t collect that knowledge, you could be leaving their replacement without valuable information they could use to do their job effectively.

If you can’t find a replacement before the employee leaves, you should start a knowledge transfer as soon as they give notice. You can ask them to create a document detailing helpful information, including any tips or tricks their replacement may find useful.

Some essential information you may want to ask for includes:

  • The employee’s daily work routine, including how they prioritize and manage their tasks.
  • Access to all the files and software the employee uses.
  • Any collaborators, both in and outside your company.
  • Any systems they use that require significant training before a replacement can access them.
  • Which digital files, like Google Docs or spreadsheets, require ownership transferring.
  • A list of their ongoing projects and tasks that may not be completed before they leave the company.

5. Hold an exit interview

One of the most important parts of the offboarding process is the exit interview. An exit interview is an excellent opportunity for you to gather insights into what your company is doing well, what you could improve on, and how their overall experience has been.

This feedback can give you insight into areas you may not have noticed, like workload, company culture, and compensation. By asking the right exit interview questions, you can gain valuable insight into what your employees really feel versus how you think they feel.

If your employees are uncomfortable giving feedback in a one-on-one with their direct supervisor, you can opt for a detailed questionnaire through HR. This way, you might get more specific and honest answers.

A few sample questions to include in an exit interview process are:

  • Did the job live up to your expectations? What were those expectations, and how did they live or not live up to them?
  • What was your relationship like with your manager and your coworkers?
  • What were some employee benefits you wished you had here?
  • What are some ways we could improve our company culture?
  • What’s great (and what’s not so great) about working here?

While these questions are just examples, you can customize your exit interview to include more specific questions about your company. Specific questions can help your company grow so you can target talented candidates and retain your current employees.

The exit interview is likely the last experience an employee will have at your company, so it’s essential to make it a priority. Any information you gather is valuable and important, even if you don’t like what you hear.

6. Revoke employee access

One critically important part of offboarding involves securing data and revoking employee access to company systems and databases. Yet nearly 25% of employees3 say they still have access to accounts from previous employers.

Not removing your former employees from all necessary company accounts leaves you open to security breaches, communication mishaps, and even delays in transferring the former employee’s system access to their replacement. You can choose to maintain access until the employee’s last day. However, you can always revoke it sooner.

The following are systems and activities you should remove an employee’s access from when they leave your company:

  • Internal platforms and files: This includes any company assets, software, documents, email accounts, password-sharing applications, company calendars and meetings, organization charts, and phone directories.
  • Company equipment: This includes collecting their keys, badges, corporate credit cards, meal cards, uniforms, phones, laptops, laptop accessories, and cars.
  • Online and offline company systems: This includes their access to any alarm and gate codes, CRM systems, company social media accounts, client information, and sales databases.

7. Develop a short-term and long-term plan for coverage

When employees leave, many of their projects and tasks may be abruptly put on hold. Sometimes their teammates are asked to cover their former coworker’s responsibilities, but this can lead to burnout and an overall stressful work environment—even with a successful transfer of knowledge ahead of time.

If there’s no plan to hire a new employee immediately, you’ll need to create a temporary work plan to ensure that business needs are still being met productively. Evaluate the work your departing employee manages so you can reassign prioritized tasks and remove any unnecessary work.

Be transparent with your employees so they can prepare for the changes and potentially additional workload during this temporary situation while you work with your HR team to backfill the position as soon as possible.

If you’re not planning to refill the employee’s position anytime soon, you can work with the affected team’s manager to restructure the team to better redistribute the workload on a more permanent basis. This way, you can focus on finding the best person for the role on your own time—without overloading your remaining employees.

Conclusion

Offboarding is the last step in any good employer-employee work relationship. A well-rounded offboarding program will keep your company productive while transitioning from one employee to the next and give you valuable feedback you can use to improve your overall business operations and enhance the employee experience.

A positive workplace culture, including an effective offboarding process, can motivate your employees to continue their advocacy of your organization long after they leave. So consider your offboarding program another effective way of attracting and retaining top talent in this competitive labor market.

1https://www.wtwco.com/en-US/Insights/2022/04/infographic-more-than-half-of-employees-open-to-leaving-employer

2https://www.wsj.com/articles/the-new-job-offer-you-want-could-come-from-your-old-boss-11639564205

3https://www.beyondidentity.com/blog/password-sharing-work

Originally published on November 16, 2022. Last updated November 16, 2022.
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