Firing An Employee

Published: 26th August 2005
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Being in the IT Enabled industry with highest attrition levels, firing an employee would be like a pinch of salt on an open wound. But sometimes, a small pinch of salt is required on the wound to stop it from getting further infected.

According to statistics compiled by the National Human Resource Development Network, attrition rates in IT-enabled business process outsourcing sector have come down from 30-33 per cent being witnessed off late to about 25 per cent now. Despite this being a much discussed issue, firing is essential because retention of non performers affects group morale. Poor employees reduce team performance by wasting time and efforts of other workers.

Often managers have to have this most hated and highly uncomfortable confrontation with an employee; firing. The response that the manager will get is quite unpredictable, as some may agree with on the failures and some may want to go on an extended argument, sometimes getting a little "physical".

The manager has to be fully prepared before firing someone as to how he handles this demanding confrontation can decide how the rest of the employees look upon the manager and the company as a whole.

When to fire

Though most of the time the manager is aware of the guidelines formulated by the company on firing, it can still be quite subjective. Generally, any employee who is not contributing to the overall goals of the company should be asked to leave. However, not before the following points are considered.

a) When the employee is not contributing towards the overall goal of the company, he needs to be made aware of this fact and helped to work in the right direction.

b) If the employee is still not able to bring his performance up to the acceptable levels, a thorough investigation should be made to assess if he needs any training. Investigation can be made through discussions, meetings, feedback from the immediate supervisor, client's feedback etc.

c) After providing the training, if the employee is still not able to come up to the acceptable levels, the manager has to go through a "Progressive Discipline Process".

d) The purpose of this progressive discipline process is to ensure that low performance is not because of a factor controlled by the company. These could be like the hiring process, the training process, evaluation methods being followed or man management issues in the team.

e) The Employee Relations Manager has to be in the loop as that ensures both the Manager and the employee get a fair deal.

How to fire

While firing has to be a last resort measure, many times fearing the repercussions, many managers delay firing, resulting in "baggage" in the team.

If the reason to fire an employee is not because of his activities as mentioned and agreed upon in the employee hand book but is solely because of underperformance, by carefully working with the employee, many performance shortcomings can be resolved.

If all help and support does not work, the manager must give strong verbal warning that specifies expected work quality or attitude improvement and cites specific suggestions for effecting such an improvement. If the employee shows no improvement, issue a written warning. Most of the time employees just need to be "shaken up" to improve their performance and a written warning does this magic, most often than not.

After a written notice, if the employee does not show any improvement, involve the Human Resource and Employee Relations and let the employee know that he is a round peg in a square hole. By following the above procedure, the manager has all papers in place to justify firing.

Firing and Attrition

Firing and Attrition are very much related to each other, though distantly. In both these cases, the manager looses trained manpower.

When Jack Welsh, ex-CEO of GE instituted his policy of yearly appraisals—generously rewarding the top 20% 'A' performers, developing the middle 70% 'Bs', and firing the bottom 10% 'Cs', he certainly did not have the IT Enabled operation in mind. Forget firing the bottom 10%, in the current situation, companies would talk about re-training the bottom 10% in an endeavor to curb the high attrition rates.

Sometimes, firing can look like attrition. In a recent news update, India's largest software service company, lost about 1000 employees at the end of first quarter of 2005. According to sources, this is the result of a carefully planned salary model called the Economic Value-added model that came into existence two years ago. This two year cycle model which involves assessment, retraining and exit discussions saw the major percentage those quitting as non-performers. They were given low ranking for the second year in a row for not showing any sign of improvement despite undergoing mentorship programme.

Looking at firing and attrition together in a different light, firing can be an excellent tool to contain attrition. Attrition can simply be defined as employee leaving his current job due to reasons like, job pressure, health problems, personal reasons, inefficient boss, lack of job security etc.

All the above reasons are interlinked and can be the reasons for good workers to quit. If the team has under-performers who despite given sufficient support and training is unable to perform, but they continue to be part of the team damage the morale of the team. A performer will not want to be part of the team which has non-performers because he will have to compensate for the non performer, thereby increasing his job output/pressure. A continuous job pressure results in health problems. Having frequent health problems not only reduces his performance, but also affects him financially. At this juncture, the performer realizes that he is working with an inefficient manager who is not capable of "cleaning up" the team by firing non-performers. With the above, the performer employee feels insecure and resigns.

Firing non-performers can be an efficient tool to contain attrition.

Message to fellow employees

By following the Progressive Discipline Process, the manager can demonstrate to the rest of the employees that he is fair and willing to give every employee a chance to improve. It is wrong to assume that this entire process happens without the knowledge of the other employees, even though they were not officially informed. As they would realize that the entire process was fair, they would feel that they have a mature and understanding management as represented by the manager.


Bangalore, INDIA.

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