When Is It Time to Fire An Employee?



When was the last time you let go of an employee without hesitation? For many, firing an employee is really hard. Let’s take a look at why, and what could make it easier to do.

In our family business seminar last week, we heard from several participants about their challenges with employees.

When the discussion turned to why it’s hard to let long-time employee “Miranda” go, a few common reasons to hesitate came up:

  • You got to know her and maybe even her family. You created relationships beyond the work environment. So, you feel responsible for her and her future, sometimes more than she does. You become attached.
  • You may have already known Miranda before you even hired her. Boy, letting her go now can get very sticky. How will this relationship survive if you “kick her out”?
  • You are not sure what will happen if she leaves. There’s a normal fear of the unknown here.
  • You’ll have to replace Miranda by finding someone new (say, James) and then training him. But who has time for that? Maybe you can just save this hiring-training process and compromise with what you have?
  • You are nervous about what other people would think about you. To complicate things, if Miranda is a family member, you may be concerned with backlash from other relatives. They may think that you are a heartless and uncaring meaniehead. You may even wonder if your other employees will feel threatened. What’s the impact on office morale?

All these concerns are legitimate – and they may also get in the way of your team’s performance.

The purpose of your business is to create value for your customers. The makeup of your team directly affects your budget. So when you inefficiently allocate your human resources, here’s what can happen:

  • You overpay for the results of that specific position.
  • Your other employees shift their attention to picking up slack instead of focusing on their roles.
  • Your staff begins to hold a grudge against Miranda and any other under-performing colleagues.
  • Your organization experiences office politics and other counterproductive noise.
  • The dead wood in your organization demoralizes your high performing employees.
  • Your employees begin to resent you for not taking a stand.

See, your team wants your leadership. Their livelihood depends on it. So does yours! When you tolerate an ineffective workforce, you cut into your own revenue, and ultimately, the money you’re taking home. Your business loses money – and so do you.

So how do you know when to fire Miranda?

  1. You communicated to Miranda all of the specific expectations of her job, and heard back from her that she understood what she is responsible for. Do not skip this step.
  2. You ensured that Miranda has the skills necessary to get the job done in a satisfactory manner and you are not willing to provide any more training.
  3. Miranda’s performance is still unsatisfactory, her contribution to the bottom line of your business is worth less than the salary you pay her, and there is no better place to move her within your organization.

It’s really that simple. So how do you make firing Miranda easier to do? Here are four tips to keep in mind when you sit down to have this talk.

  • Be aware that by letting Miranda go, you create an opportunity for her to find more fulfilling, achievable work somewhere else.
  • Detach yourself. This business decision is not about who you are or who she is as a person.
  • Keep the discussion very straightforward. Focus on facts like expectations, performance, and results.
  • Do not strike deals. Do not give Miranda another chance. Do not give in to pleas. By this point, the time for Miranda to recommit and follow through on unmet expectations has passed.

What would it be like if you applied these principles to your own company? Comment below and let us know your thoughts.