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When to Fire Employees and When to Give a Second Chance

When to Fire Employees and When to Give a Second Chance

I’ve never met a business owner who felt good about firing employees. Even when the employee deserved to be let go for excessive tardiness, ineffective work product, or countless other justifiable reasons to terminate employment, the owners I’ve spoken with have shared how they struggle with the decision because—deep down—they know that employee is still a person with a family to support and bills to pay.
Ultimately, this type of empathy or human kindness may cause you to reconsider this very same thing in running your own small business. But when you should you give someone a second chance and when should you say that enough is enough, it’s time to let them go?

When a Second Chance May Be Appropriate

Giving an employee the opportunity to keep his or her job may be appropriate under these types of circumstances:

  • It’s a one or two-time offense that is out of character for the employee. If the employee has never shown up late once in ten years, then shows up late for work two days in a row, you may be jumping the gun letting him or her go. First, you might want to ask the circumstances, as it may be something as simple as car troubles to blame. Ask how they intend to rectify the situation and see if you can make other arrangements that still allow them to get their work done without compromising their job, like letting them work from home for a day or two until they can get their vehicle fixed.
  • The employee is going through (temporary) rough times at home. Certainly, you can’t stop running your business every time an employee has a personal crisis, but instances such as family sickness, death, and divorce are typically temporary situations that you may be able to remedy easily. Some options include offering flex time or, at a minimum, setting up some type of schedule to make the tardiness or calling in to work no longer an issue. You can also do what Barbara Corcoran does when she realizes that morale at the office is low overall. She holds sales meetings and asks her staff to pick weeks off for vacations, hoping that time off will reverse their moods.
  • The employee isn’t doing well in his or her current position but has other strengths you don’t want to lose. For example, if you have an employee who is bombing at sales but does an amazing job dealing with suppliers then, instead of letting him or her go, why not change job duties to accentuate the person’s strengths and minimize the weaknesses? By taking this type of action, everyone wins. The employee gets to keep his or her job and you get to keep a top notch member on your team.

When You Probably Should Just Let Them Go

Now that we’ve listed some instances in which a second chance could be the right thing to do (for both you and your staff), it’s time to go over a few of the circumstances when you should just let them go. Here are some to consider:

  • Their behavior is worsening over time. If you have an employee who is progressively getting worse, calling in sick more often or continuously mistreating clients or customers, then keeping him or her in your employ will likely do your business more harm than good. Because of this, it’s time to cut the strings and go your separate ways.
  • They have a bad attitude—all of the time. We all fall on hard times when our attitude declines and we struggle to keep a smile on our face. However, if you have an employee who is constantly in a foul mood, focusing on the negatives more than the positives and speaking more about what is wrong than what is right, this too could take its toll on your business because of the effect it has on customers and staff. Case in point: one study conducted at Sears Roebuck & Co. found that an improvement in employee attitude resulted in a 0.5 increase in earnings.
  • They undermine your authority. Owning your own small business means that you call the shots. No ifs, ands, or buts. So if you have an employee who regularly undermines your authority, bad-mouthing you or your managers to others or refusing to do what you’ve asked, then it’s probably time to find a replacement. No one has to agree with you 100 percent of the time, but if they are willing to share their disagreement publicly, and with the wrong people, that’s publicity your business doesn’t need.
  • You’re getting complaints. A huge indicator that it’s time to let someone go is if you’re receiving complaints from staff, customers, suppliers, vendors, or anyone else that has to deal with them. This is especially true if the complaints revolve around not following policy or procedure, potentially disrupting your entire work flow as you’ve created it.

While there is no cut and dry line in the sand that says when you should fire someone and when you should give a second chance, these are just some of the instances in which one option would likely be better than the other.
What are your thoughts on this topic? When do you fire someone and when do you give him or her a second chance? I’d love to know, so feel free to comment below!
I’m always interested in learning other small business owners’ thoughts on relevant topics and issues, so if you have a comment or unique article idea, feel free to contact me at [email protected] (put “Businessing Magazine” in the subject line, please). If I use it, it’s a free link to your website!



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by Christina DeBusk // Freelance writer, author, and small business consultant committed to helping entrepreneurs achieve higher levels of success.

Opinions expressed by contributors are their own.