The Complete Offboarding Checklist: How to Offboard an Employee?

The Complete Offboarding Checklist: How to Offboard an Employee?

May 18, 2024
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Author: Hamza

When an employee unexpectedly decides to leave, it can be a shock to the employer and can lead to workplace disruption. Similarly, a poorly managed offboarding process can result in dissatisfaction for the departing employee, who may share their experience online, where potential new employees and customers can see it. This can impact the brand reputation, employee retention, and talent acquisition.

Therefore, it is important to have a strategic offboarding process that involves a complete offboarding checklist and follows best practices. That's what this guide is all about. Here, you will learn everything related to employee offboarding, including its overview, checklist, and some key best practices.

  1. What is Offboarding?
  2. Why is Offboarding Important?
  3. How to Offboard an Employee: The Complete Offboarding Checklist
  4. Best Practices for Employee Offboarding
  5. Wrapping Up – Uplift Your Offboarding Game

What is Offboarding?

Offboarding is the process of transitioning the departing employee out of the company. This process is executed whether the employee departs voluntarily or involuntarily.

Offboarding is about:

  1. Smooth separation from the former employee.
  2. Ease transition from old employee to new one.
  3. Protect the company from lawsuits.
  4. Improve new employee hiring.
  5. Help the company grow and improve company structure.
  6. Maintain data and access security.
  7. Support the career transition for the departing employee.

Offboarding is not about:

  1. Criticize or attack the departing employee.
  2. Convince the employee to prolong the departure or stay.
  3. Create unnecessary barriers.

In short, employee offboarding is the complete process of changing an employee's status to "former" while following all company and legal requirements with professionalism.

Why is Offboarding Important?

A well-strategic offboarding process not only ensures a graceful way to offboard employees but also offers many other benefits to the company. The below points will highlight the importance of offboarding:

  1. Improved Security: It improves the security of the company's sensitive data and information by properly revoking access and handoff of data.
  2. Proper Collection of Company Assets: It ensures the proper and complete collection of company-provided assets, which helps protect the data/asset from wrongful use.
  3. Reduced Legal Threats: It ensures that employee contracts are closed properly, which helps to reduce legal threats or lawsuits from former employees.
  4. Insightful Analytics: The thorough offboarding process helps the higher management, HR department, and managers to look into the root causes of offboarding. Afterward, your company can make the required decisions to improve recruitment and retention.
  5. Former Employees as Brand Ambassadors: Former employees become the company's customers and brand ambassadors. A well-executed offboarding process leaves a positive impression on employees and allows them to act as free brand ambassadors.

Overall, the employee offboarding process is the key to streamlining the departure of employees, protecting the company from threats, and optimizing the company processes.

How to Offboard an Employee: The Complete Offboarding Checklist

A well-structured offboarding process lets the company and employee gradually handle the final phase of interactions without getting into a stressful or awkward situation. Therefore, here is the complete offboarding checklist for setting an effective offboarding process:

1. Communicate the Departure

Once the employee offboarding is confirmed, the first thing to do is communicate the departure. Inform the team that their teammate is leaving to avoid unwanted gossip in the workplace. In addition to the teammate, communicate the departure news to managers, the IT/HR department, and similar others so that necessary processes are carried out.

2. Knowledge Transfer

If you have already planned the successor, this step should be easy for you. In this step, you will ask the departing employee to transfer their knowledge and train the successor.

Even if you don't have the successor yet, you can create a documentation that involves:

  1. Ongoing tasks
  2. Daily/weekly schedule
  3. Tools/resources used
  4. Key processes
  5. Tips/tricks

Documenting all this information will help the successor obtain the necessary training and quickly start working from where it's left.

3. Update System Access

One of the crucial offboarding checklist items is revoking system access and recovering company assets. Ask the IT team to revoke the employee's system access. This can include:

  1. Email platforms
  2. CRM tools
  3. Intranet solutions
  4. Social media accounts
  5. Sales dashboards
  6. Content databases

In short, all the platforms and channels from where employees can access or use company data should be revoked. Afterward, also update the org charts and company directory.

4. Recover Company Assets

Next, make sure you recover all the company assets from the departing employee. This can involve laptops, tech gadgets, vehicles, or any type of hardware asset that belongs to the company.

5. Complete Necessary Paperwork

Offboarding involves some paperwork to complete. Make sure all the paperwork is completed. This can include:

  1. 401 (k) information
  2. Non-disclosure agreement
  3. Tax documents
  4. Non-competent agreements
  5. Health check information

The paperwork and legal obligations can vary from company to company. So, complete this process properly to avoid legal complications later on.

6. Complete Final Pay Process

Make sure you clear all the payments of the departing employee. Hand them the final paycheck and remove them from the company's payroll.

7. Arrange an Exit Interview

Another important offboarding checklist element is arranging an exit interview. You should interview the departing employee to learn about their experience with the company. You can ask about their feedback on company culture, workload, management, colleagues, and other elements.

You can shortlist a few interview questions beforehand to maximize the interview outcomes. The questions can be about:

  1. Was the job up to your expectations?
  2. How was the workplace environment?
  3. How was your relationship with your coworkers and manager?
  4. What did you admire the most?
  5. What are your suggestions on areas we should improve?

Overall, hold a thorough interview to help the company improve its workspace and optimize areas where it is lagging.

8. Provide Exit Documentation

The last point in the offboarding checklist is about providing the exit documentation. The types of documents can vary from company to company. This can be about final pay, service certificate, experience letter, and similar others. If the employee asks for a reference, you can also provide that.

Best Practices for Employee Offboarding

Now that we have looked into how to offboard an employee, let's shed light on a few best practices related to offboarding to enhance the efficiency of this process further:

1. Handle Productivity Loss

When an employee leaves (planned or suddenly), many responsibilities and projects are put on hold until a replacement is found. Sometimes, other employees are asked to fill the gap, which can make the work environment stressful.

To tackle that, you must understand how an employee's departure will affect the other employees and the project. Compensate employees for the additional work they will do and try to find a replacement quickly. In fact, it is recommended that a replacement be hired before the employee departs for effective knowledge transfer.

2. Ensure Kindness and Fairness

Although the employee is leaving your company, they should be treated with kindness and fairness. Your behavior and assistance during the offboarding period should be the same as if they are still working for your company. As mentioned earlier, former employees become your company's brand ambassadors, so it is important to have friendly and supportive last moments with them.

3. Designate Offboarding Personnel

To have a smooth offboarding process, assign someone to handle the offboarding process. This will help ensure that all necessary steps are completed promptly and accurately.

4. Make Goodbye Memorable

Make the goodbye worth remembering. You can appreciate their contribution to the company, give them a group card, or arrange a team lunch. These practices will leave a positive impact and let the departing employee become the brand ambassador for your company.

5. Support Returning Employees

After the employee has left your company, be open to having them return. According to the Skynova study, 42% of returning employees perform at the exact same level as before, while 38% even show more performance improvement. That's why it is important to support the return of employees if their skills are still valuable to your company.

6. Keep Improving the Offboarding Process

With the rapidly changing corporate dynamics, you must revisit your offboarding process regularly and optimize it where possible. For example, you can now use automated tools to automate some offboarding processes. Similarly, you can get feedback from departing employees and make the changes. Overall, the goal should be to keep the offboarding process simple, accurate, and satisfactory for both parties.

Wrapping Up – Uplift Your Offboarding Game

Employee offboarding is a process every company needs to provide. A well-executed offboarding process makes a satisfactory goodbye to the employee and helps the company fulfill all the regulatory and corporate requirements. For that, the best way is to create an offboarding checklist and assign personnel to streamline the whole process. Therefore, we will wrap up by recommending you use this guide as your reference and uplift your offboarding game.

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