Why Offboarding Matters for Employers

When an employee leaves a company, whether voluntarily or involuntarily, how that exit is handled matters exceptionally for your business! Implementing a thoughtful and strategic offboarding process allows employers to protect their company’s interests while maintaining positive relations with departing staff. Too often, offboarding employees is an afterthought, but this crucial transition period presents risks and opportunities that savvy companies should pay attention to. Taking the time to properly conclude the employment relationship can prevent legal issues, data breaches, culture clashes, etc. Read on or contact our team at Horizon today to learn more! 

What is Offboarding?

Offboarding refers to administrative tasks and procedures when an employee leaves a company permanently. It encompasses everything from conducting thorough exit interviews and gathering company property like laptops, cell phones, security badges, and access cards to revoking access to corporate accounts, networks, systems, documents, and more. 

Specifically, a positive offboarding experience includes formal and informal steps such as:

• Exit interviews to gather feedback 
• Collection of company-owned equipment 
• Revocation of access credentials to accounts/systems 
• Completing termination paperwork 
• Removing the employee from payroll/benefits 
• Announcing the employee’s departure to staff 
• Paying out remaining paid time off/expenses 
• Transition planning with the manager/team 

Well-executed offboarding ends the working relationship positively and sets both employer and employee up for success after the departure. 

Why is Offboarding Important?

Beyond basic HR administration and preventing future employee turnover, below are a few key reasons to make effective offboarding a priority for your business!

Benefits of a Good Offboarding Process

Investing in a quality offboarding process offers organizations tangible and intangible advantages. From concrete data security improvements to good interpersonal relationships, strategic offboarding creates value across the board. 

An Exit Interview Provides Valuable Company Feedback

Exit interviews yield valuable insights by directly asking departing employees targeted questions about their reasons for leaving, employment experience, relationships with managers and peers, and sentiments about company culture, workplace policies, and daily working conditions. Candid feedback helps identify issues causing turnover or job dissatisfaction that managers may need to be more aware of - such as lack of career development, poor work-life balance, compensation concerns, leadership problems, culture issues, lack of accountability, etc. These interviews can inform company improvements to retention efforts with new employees, culture initiatives, policies, and more. 

For example, if multiple existing staff mention limited growth opportunities, the company should invest more in internal mobility and training programs. Uncovering one or two easily fixable issues through offboarding conversations can help boost retention in the future!

Maintain a Good Relationship with Departing Employees

Parting with employees positively and professionally preserves their goodwill as alumni, brand advocates, or future customers. Offboarding done poorly or confrontationally can needlessly breed resentment and bad-mouthing, even if the person harbored no ill will beforehand! Preventing burned bridges safeguards the company's reputation in the community and industry. Additionally, former staff still in contact with current employees can negatively impact culture and employee retention if they leave feeling disgruntled rather than supported. 

For example, an employee who has served as a team lead for many years leaves after being passed over for promotion multiple times. If offboarded respectfully via exit interview and transition planning, they will likely speak neutrally or positively about their experience. However, if they leave feeling slighted without closure, their lingering bitterness can influence the remaining staff to feel pessimistic about growth opportunities.

Increase Data Security and Reduce Compliance Risks

Once someone leaves a company, their user credentials must be promptly deactivated so they can no longer access accounts, networks, or systems holding sensitive company or customer data. Without an offboarding process, significant security issues and data breaches can occur from former staff accessing files accidentally or even attempting to steal trade secrets. Revoking access immediately reduces legal, financial, and compliance risks related to unauthorized data access after termination. 

Steps to a Successful Offboarding Process

Delivering a successful offboarding transition requires methodically working through procedures with attention to detail. While checklists facilitate tracking requisite tasks, the right mindset from leadership sets the appropriate tone for these processes. 

Note: Treat Departures with Fairness and Kindness

Before detailing the logistical steps involved, the mindset underpinning the offboarding process bears emphasizing. Exiting employees should be treated with fairness and kindness through the complete offboarding transition. Any required tasks should be explained respectfully without undue suspicion. This grace-based approach prevents emotions, anxiety, and frustration from running high during an already sensitive career transition. For example, avoid interrogating the employee about reasons for leaving. Instead, calmly explain offboarding tasks like handing in badges or signing paperwork to have them leave on good terms. 

1) Communicate Departure Terms Clearly

To prevent confusion that can cause conflict or legal issues, clearly convey the final dates of employment, benefits termination details, the going away announcement, when exit interviews will occur, the anticipated timeline for completing transitional offboarding tasks, and contact details for any questions. Provide both thorough written documentation and verbal confirmation to align expectations. 

2) Determine the Reason for the Exit

Make time to meet with the departing employee for an open, non-emotional discussion exploring their reasons for leaving. Listen earnestly without judgment to their perspectives on relationships with managers and peers, growth opportunities, compensation, work-life balance, leadership issues, company culture, policies, and daily working conditions. This exit interview dialogue provides valuable feedback to inform improvements to culture and retention efforts! Take notes during exit interviews on constructive areas the employee identifies for improvement to inform positive organizational change. 

3) Secure Company Property and Revoke Physical and Data Access

Collect company-owned equipment like laptops, tablets, cell phones, security badges, keys, etc., on or before the worker's final day. To prevent data breaches, reset passwords and terminate access at both user and administrative levels to networks, cloud apps, documents, databases, and other systems related to the employee's role. Conduct reviews to ensure access removal is complete across platforms. 

4) Sign Paperwork and Make Final Payments

Provide and sign the necessary termination, non-compete, and non-disclosure agreement paperwork with the departing employee. Also, remove them from payroll and benefits plans while ensuring that they receive final pay for time worked, expenses, etc. Send company announcements about the departure and provide details on temporary coverage of the former employee's duties. 

Horizon is a Top-Rated Payroll and HR Solutions Provider

Rather than trying to handle complex offboarding and HR tasks amidst pressing strategic initiatives, consider partnering with specialists, like our team at Horizon! When employment concludes, leverage outsourced expertise to heighten compliance, security, and interpersonal sensitivity. 

Trusted and Professional Business Services

Seamless employee offboarding is complex, requiring payroll processing, compliance documentation, access termination, equipment returns, final payment calculations, culture management, and more.  

Horizon provides full-service, legally compliant payroll and complete HR solutions tailored to small and midsize business needs across the employee lifecycle. Our HR pros have specialized training in graceful yet confidential employee separations. We can become your outsourced HR department, managing the offboarding and onboarding process for new hires, and everything in between with personalized service and cutting-edge HR technology integrations! 

Contact Horizon Today for More Information

Experience the expertise advantage with Horizon as your fully outsourced HR department! Schedule a free consultation today with our award-winning customer service team to customize your business solutions to fit your exact needs. Contact us for more information!