The Role of HR in Employee Termination

Terminating employment is always challenging. Not only does it require ending a working relationship, but it’s a process that needs to be handled carefully and appropriately whenever possible. 

Most large companies will use human resources to oversee the dismissal, with professionals conducting terminations legally, ethically, and in a manner that minimizes disruption to the organization. Let’s take a look at the role HR plays in the process. 

Ensuring Clear Communication With Employees

How a termination is carried out is as important as the decision itself. Poor choices and actions can lead to unnecessary anguish, confusion, and even legal troubles. The message must be delivered clearly and thoughtfully, with no room for ambiguity. 

It isn’t a time to be vague, leaving an employee unsure about what has just happened. It’s tempting to want to be overly nice, but that’s not always what’s best. Employees must know they are being dismissed, the reasons behind it, and what happens next. HR will usually prep the manager in question before the termination meeting, ensuring they know what to say and how to say it. 

HR might also be called on to help with support or answer questions should the employee have any. They must leave the meeting understanding the outcome, their rights, and what severance package, if any, is on offer.

Evaluating Legal Obstacles

Employee termination can be a legal minefield if not handled correctly. HR needs to ensure that the dismissal is legally sound, which involves reviewing the employee’s contract, understanding the reasons for termination, and ensuring that the company complies with all relevant laws and regulations. 

A wrongful termination lawsuit can be expensive, especially if it involves a simple case of failing to check certain documents. The average settlement for such a case in the United States is $37,200, and these cases happen all the time. 

Those in HR need to be well-versed in all aspects of employment law to ensure this doesn’t occur, which involves keeping documented evidence supporting the termination, such as performance reviews or records of misconduct, which can be crucial if the decision is ever challenged in court.

Managing the Emotional Impact

The emotional impact of a dismissal should always be considered, especially if the employee doesn’t know it’s coming. With livelihoods on the line, it’s not uncommon to witness a range of emotions during a termination meeting, from anger to devastation. 

In addition to handling the logistical side, HR needs to provide emotional support for the employee while also having information at hand, such as outplacement services, counseling, or guidance on applying for unemployment benefits.

HR also needs to ensure the termination has no negative ripple effect. Other employees might be fearful of their own jobs, so it’s essential to communicate why a person was dismissed and alleviate any team fears.

Coordinating Final Compensation and Benefits

Another crucial responsibility of HR is handling the financial and benefits side of termination. They must ensure that the employee receives any final compensation, including unused vacation days, severance pay (if applicable), and any other benefits they’re entitled to. HR coordinates with payroll to ensure everything is processed smoothly and complies with legal requirements.

Additionally, they must update government and third-party records, such as health insurance, retirement plans, and other company benefits. These factors also need to be communicated clearly to the departing employee, ensuring there’s no confusion in the future.

Conducting Exit Interviews

Exit interviews are a valuable tool for companies to gather feedback from departing employees, and HR typically conducts these interviews. Even in the case of involuntary termination, there’s an opportunity to learn from the employee’s experience. Exit interviews can provide insights into potential issues within the company, such as management practices, work culture, or other factors that may have contributed to the termination.

Frequently Asked Questions

What Is HR’s Role in the Termination Process?

HR’s role in termination is to ensure that dismissal is handled fairly, legally, and ethically. They will also often prepare managers for the termination meeting and support the departing employee.

Should HR Be Present for Terminations?

Yes. HR should undoubtedly be present in every termination meeting. Their role as professionals in the matter is vital, especially if there is any contention over the dismissal. Their presence also helps protect the company by ensuring that company policies and legal requirements conduct the termination.

Final Thoughts

The role of HR in employee termination is vital, and not having them there leaves a company exposed legally and may also mean the dismissal isn’t carried out correctly. Terminating an employee is never easy, but having a professional by your side, ensuring that everything is carried out to the letter of the law and with as much dignity and honesty as possible, is the least you can do, and most departing employees will respect that.

Termination might happen for all manner of reasons, but what often arises is that the person was a bad hire and should never have been brought on board in the first place. While it’s impossible to guarantee that you’ve made the right choice during the hiring process, using ScoutLogic’s background screening services gives you the best chance to make the best choice possible. Don’t let avoidable mistakes lead to difficult terminations—make sure you’re starting with the best possible team.

David Garcia

David Garcia, co-founder and CEO of Scout Logic, is an industry leader in the bulk background check world. With his strategic acumen and expertise in the HR sphere, specifically in hiring, recruiting, legal compliance, background checks, and resume screening, he’s an invaluable asset and consultant.

David's counsel extends across the boards of ScoutLogic, YipitData, and Supplier.io, drawing from his impactful stints on the boards of Infutor and Avetta. With an extensive 25-year journey, he champions unparalleled B2B commercial leadership within data & analytics, significantly shaping the HR landscape.