Getting fired is a horrible experience, but it doesn’t have to be. Losing a job is hard on an employee, and terminating an employee can create a whole mess of grief for the company as well. This is especially hard for any small-business owner heading up a tight-knit group of employees, some of whom might even be considered friends. In a 2018 article for the Harvard Business Review, Investopedia CEO David Siegel laid out his strategy to avoid some of the troubles of termination by offering a more considerate approach to firing: transparent separation.

In a transparent separation, when underperforming employees are informed that their tenure with the company is coming to an end, they are given a time frame within which they can prepare for a new job before their last day. Employees are asked to keep the arrangement confidential and are expected to maintain job performance. Transparent separation is a wild departure from the traditional termination playbook, but Siegel insists that the strategy offers some incredible benefits:

  • Departing employees avoid the struggle of trying to find a new job while unemployed.
  • There’s reduced legal risk that the company might be sued by an angry employee.
  • Managers are not cast in an adversarial role for abrupt firings.
  • The company has time to find a suitable replacement, resulting in a smoother transition.
  • Remaining employees feel more comfortable when they don’t have to worry about “disappearing” overnight.

Even with all these positives, Siegel notes that transparent separation may not be the best course of action for every employee termination. For example, if the soon-to-be-ex-employee exhibits toxic behavior that is harming the work environment, they need to be shown the door immediately. There’s no reason to let the harmful components of your company fester into malignance. Siegel claims that in two-thirds of cases, transparent separations offered the best outcome both for the company and the former employee, but opponents to this strategy note the potential damage a disgruntled employee can cause after being told they are losing their job. Some employees may even prefer to collect severance and leave so they can fully focus on the job search.

Whatever you choose, the jury’s still out on whether or not transparent separation is the best choice for your small business, but there’s no one-size-fits-all solution to any business problem. What works great for one company might not be best for another. But if you think the pros outweigh the cons, transparent separation might be worth considering the next time your company has to say goodbye.

by: Charles Jackson,
AFEUSA President

Charles Jackson President AFEUSA