5 Common Mistakes Employers Make When Firing an Employee (And How To Avoid Them!)

Let's face it: nobody starts their day thinking, "I can't wait to fire someone today!" Yet, it's a reality that many employers and office managers at small businesses must face at some point. The process can be riddled with mistakes that not only compound the discomfort but can also have lasting negative effects on both the company and the employee being let go.

This blog will help you avoid some common mistakes employers make when letting someone go.

First things first, we recommend you download our complimentary termination checklist. It will go over everything you need to consider before making a decision to separate from an employee and ensure you’re protected in that decision. We also have an entire webinar on Firing Without Fear that has a ton of actionable information. 

Mistake 1 - Making Snap Decisions

We had to list this first because it’s probably the most common mistake we see within our HR Solution Center. Essentially, we’re all human. Sometimes, emotions can get the best of us in these situations. If this has happened to you, don’t worry; you’re not alone.

Feeling a sense of urgency is common when you’re ready to let someone go. What we need you to know here is that an emotionally fueled decision to terminate immediately can carry heightened risk and actually create more problems for you and your team. Terminating in the heat of the moment means you’re not taking the time you need to think about what to say to the terminated employee or to your remaining team. Saying something you regret can have legal ramifications when you’re speaking to an employee. 

An on-the-spot termination also means you do not have the individual's final pay ready, and they are sure to be asking you about it immediately. This is even more of a problem if your state requires you to pay someone on the day of termination. 

If you work in healthcare, it’s absolutely critical that you immediately shut down the terminated employee’s access to your office as well as all of your systems. Imagine the damage your just-fired employee can do if they are able to access their work email from their phone before you’re able to find time in your day to even think about what type of access that individual has.   

Finally, your team will also feel the impact of the termination without a plan for covering that person’s job duties—particularly if they are involved in patient care. 

How you can avoid it: First things first, take a step back from the situation and breathe. Yes, it is always important to address the issue in a reasonable time period. Terminating too fast can easily result in missing crucial steps. 

Unless there’s an immediate danger to having someone continue working, it’s a good idea to take stock of the situation in as calm a manner as you can before actually firing the person. Even giving it just a few hours so you can get your ducks in a row can make a huge difference. 

What should you do if you’re feeling like an employee needs to be let go immediately? Take a moment in your office or a walk around the block to clear your head. Contact CEDR so you can talk the situation through. 

Even if your reason for terminating is completely legal and substantiated, express your frustration to a third party so you can vent a little so it doesn’t impact your communications with your team or lead you to say something you shouldn’t when you do terminate your employee. 

Review the employee’s file to make sure there’s nothing unusual that’s gone on with the employee that may make the timing of the termination risky. For example, if they just used a legally protected sick day or complained about unpaid overtime. 

Finally, write a termination letter, check your final paycheck rules (see Mistake #5 below), and develop a plan for what will happen after your employee exits.

Mistake 2 - Not Giving a Reason for Termination

There are two main reasons why employers might choose not to tell their employees the reason they’re being fired. 

One is because you don’t want to be mean and view this as a way of avoiding confrontation. Even with all the best intentions involved, this approach is actually more of a disservice to the employee. Not knowing why they were fired can leave the employee feeling confused and disrespected by the lack of transparency.

The second reason is the idea that you do not need a reason for termination if you  are in an at-will state. Note that the only state that isn’t at-will is Montana While at-will employment technically doesn’t require that you “have a reason” to terminate - you do have a reason. You didn’t wake up and decide it would be fun to pick a random employee to fire for absolutely no reason at all. 

If an employee is being terminated, there is a reason for it, and the employee knows that. If you decline to tell them what that reason is, an easy inference for them to make is that you have something to hide. Instead of hearing that they have made too many significant mistakes, getting upset about it for a couple of days, and then moving on, the terminated employee is likely going to find an attorney who can help them uncover what it is you’re trying to hide.

How you can avoid it: You can provide a clearer, more respectful termination process by addressing the real issues head-on instead of giving in to the temptation to avoid or sugarcoat it. This not only aids in the former employee's understanding and acceptance of the situation but also protects your business from potential legal repercussions. 

This can be direct and to the point, without rehashing the entire situation, in both your conversation with the employee and the termination letter. Remember, clarity and documentation are your best allies in these delicate situations.

Mistake 3 - Attempting to Terminate via Phone or Email

Members of our community often ask, “Can we terminate an employee over the phone? Or just send them an email?” We all want to avoid conflict and confrontation sometimes, especially when it comes to difficult conversations like terminations. 

While there aren't any laws pertaining to how termination conversations need to be held, HR best practice is to have them in person. Meeting with your employee face to face shows much more respect to them than a phone call or an email. It also gives a greater sense of closure than an unexpected phone call.

You may envision a phone call being faster and easier, but you can actually maintain more control over the conversation if you are in person. That awkwardness of the in-person meeting that you’re worried about? The employee you are terminating is going to feel awkward as well and will probably want to end the meeting as quickly as you do so they can get out of that situation. 

A phone call does not have the same level of active presence, so it can actually drag on longer and be harder for you to professionally end. Body language, such as standing up to indicate you are ending the conversation, is not possible over the phone or in an email chain.   

Finally, consider the logistics of things. When your employee arrives at the office in the morning, you can pull them into a meeting and get the termination over with. This is quite different from playing phone tag or wondering whether your employee is going to check their email before they drive in for their next scheduled shift. 

How you can avoid it: Even if it seems tough, be sure to hold all your termination conversations in person, in a private area, with another person as a witness to the conversation. Having another person there not only helps alleviate any “he said/she said/they said” accusations, but it can also help relieve some of the tension you may have about the situation. 

Mistake 4 - Improper Team Communication

Something that can very quickly cause tension among your team is not knowing what happened when someone leaves your business - when it’s not communicated about at all from management, as if the person never existed. It can leave your team feeling uneasy, negatively impacting morale and engagement and leading them to speculate unnecessarily.

You do need to communicate with your team when a termination takes place, but you do not need to tell them all the details. The only thing that needs to be shared with the entire team is that an employee is no longer working for the business and what is happening in terms of replacing that employee or restructuring their essential functions. 

Sometimes, more information needs to be shared to promote better customer service or to managers who need to be included in staffing plans, which is completely fine and up to your own discretion. However, some employers lean toward making an example of employees or offering too much information about why an employee was let go - you do not want to do this.

How you can avoid it: It's ultimately your burden to keep employment details private and keep work conversations professional and appropriate. Communicating right away with your team in a professional way that the previous employee is no longer working with you, and where they can go for their job duties is all that really matters and will show your team that you aren’t trying to hide anything. Before terminating an employee, prepare yourself to answer the question, “Why now?” as your team and other outside parties may end up asking you this. 

When it comes to using that employee to set an example, that is never the right way to go. Your established policies in your employee handbook and Progressive Corrective Coaching are how employers should enforce systems and procedures, not through examples of prior employees failing to meet expectations.

Mistake 5 - Final Pay as an Afterthought

Usually, this is the last thing on an employer's mind during a termination, but the first thing on the employee’s mind. This is why it can quickly get you into trouble if you don’t handle it the right way. Employees are smarter than ever these days, know their own rights, and will be expecting to get their final pay by whatever deadline your state requires. Even if they do not know the actual law, they may be hounding you on a regular basis about their pay until they get it. They will for sure be vocal about it if something goes wrong on your end. 

How you can avoid it: Many states have strict final pay laws, so it's important to think about final pay alongside any termination decision. This is where the checklist we mentioned above comes in handy. Checking to make sure you have everything prepared before the termination conversation is essential. 

However, this is another reason not to make a snap decision to terminate. If at all possible, regardless of what your state law requires, we highly recommend providing the final paycheck at the time of termination if at all possible. This immediately takes care of the thing that is top of mind for the employee and also reduces the likelihood that the employee will reach out to you after the termination. Having their final pay in hand allows them to mentally move on a lot more easily. 

Note that you can do this even if you normally offer direct deposit. Ask your payroll provider to calculate their final pay, including regular payroll tax deductions, and email you the breakdown. You can use that documentation as the “pay stub” and write out a business check for the total amount. 

It's important to look closely at final pay and deductions to make sure you're not violating state or federal compensation regulations. As always, work with an HR Expert to ensure you are following your local laws properly. 


It's clear that handling HR tasks, especially dismissals, requires careful navigation to avoid mistakes and costly legal issues. But we’ve got your back! You have enough to worry about as a business owner or manager, so remember, you’re not in this alone. Let us work together to empower you to tackle not only terminations but all HR challenges with confidence and legal compliance.

By joining CEDR, you will gain access to a comprehensive suite of HR software and the guidance of seasoned HR professionals. This means less stress about legal risks and more focus on growing your business. We are designed to support small businesses in managing their teams effectively and with peace of mind.

Don't let HR tasks become a stumbling block for your business. Become a member today and join over 3,000 other businesses that have turned their HR processes into strengths. It's time to take control of your HR tasks and lead your business to success with CEDR by your side. 

If you’re not ready to become a member, that’s alright too. Join our community for free HR education delivered to your inbox weekly! 

May 12, 2024

Friendly Disclaimer: This information is general in nature and is not intended to provide legal advice or replace individual guidance about a specific issue with an attorney or HR expert. The information on this page is general human resources guidance based on applicable local, state and/or federal U.S. employment law that is believed to be current as of the date of publication. Note that CEDR is not a law firm, and as the law is always changing, you should consult with a qualified attorney or HR expert who is familiar with all of the facts of your situation before making a decision about any human resources or employment law matter.

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