Employee Exit Process: 9 Best Steps to Get It Right

Dec 6, 2023 | HR Trends

Josh Rust

As Abenity's Marketing Manager, Josh has a keen insight into the latest HR and recruiting trends.

The employee exit process is a big deal for your company’s reputation.

A messy exit can tarnish your company’s reputation and can cause discontent among your remaining team. 

And here’s the deal: You know it, and you want to nail the offboarding process. You don’t want to just tick a box—you want a thoughtful process that leaves a great impression.

Because when an employee’s exit process is thoughtful, it removes a ton of risk.

Problem is…when you’re dealing with such a sensitive topic, it’s very easy to get wrong.

So in this blog, get ready for the employee exit process best practices that go beyond the basics. 

If you want to turn your former employees into raving fans, read on.

What Is the Employee Exit Process?

An employee exit process is how you handle and oversee an employee’s departure. 

Here’s an overview of an employee exit process.

  • It usually starts with an employee giving notice. Communication is key at this stage—letting everyone involved know about the departure.
  • Once the departure news is out, it’s time to plan your transition. This includes figuring out who will take over the responsibilities and ensuring a smooth handover.
  • Then, you wrap up legal and administrative employee exit paperwork, like returning company property and settling any financial matters.
  • Another important step is knowledge transfer. Encourage departing team members to document their roles, responsibilities, and ongoing projects. This ensures a smooth transition for the remaining team.
  • Then, exit interviews. Find out why the employee is leaving, what worked well, and areas that may need improvement.
  • After that, they need a proper farewell. Departing employees deserve a proper send-off. Events like organizing farewell lunches, gatherings, or small ceremonies to acknowledge their contributions and leave a positive impression.

In a nutshell, the employee exit process is your playbook for employee farewells. 

It’s not just about ticking off boxes; it’s about being a good employer and having something that benefits both the departing employee and your organization. 

Now, let’s dig deeper into why it matters and how to make it work.

5 Reasons Why Your Employee Exit Process Matters 

This process can be easy to gloss over. But here are five serious reasons why you shouldn’t:

Reason #1: Maintaining Professionalism

According to Indeed, professionalism helps you get recognized, shows you’re dependable, and makes you earn more respect.

A well-handled exit process isn’t just a gesture; it’s a commitment to professionalism. It ensures that your workplace maintains its composure even in goodbyes, minimizing disruptions.

Reason #2: Gathering Valuable Insights

Leaving employees can be a source of valuable insights. 

Through exit interviews, you discover loopholes in your processes and systems. Knowing why employees leave equips you with the knowledge to refine your company’s culture, processes, and retention strategies.

Reason #3: Preserving Your Company’s Reputation

Your company’s image is precious. 

Actually, according to Harvard Business Review, firms with strong positive reputations attract better people.

A positive offboarding experience leaves a departing employee with a great impression. This positive energy can echo and influence your company’s brand and attract talented people.

Reason #4: Minimizing Disruptions

Key team members departing can sometimes be disruptive. 

An effective exit process ensures a seamless transfer of knowledge, minimizing disruptions. It helps the remaining team carry on without missing a beat.

Reason #5: Contributing to Continuous Improvement

View the exit process as a guide for improvement. 

Embracing feedback and learning from departures makes your organization grow continuously. Always remember: you can always learn from everyone, even from your departing employees.

Continuous improvement also gives your current and future employees the basis they need to solve the problems they encounter in their work themselves. 

In the next section, we’ll dive into the exciting part—creating an employee process that works and leaves a good impression.

How to Create an Employee Exit Process That Works

Step #1: Plan Ahead 

Before you say goodbye to your employee, lay the groundwork. 

Determine the departure date and create a comprehensive timeline. Clearly define responsibilities for HR, IT, department heads, and the departing employee’s manager. 

This step ensures you won’t be up a creek without a paddle when your employee leaves. Make sure everyone knows their role and how to pick up the slack.

Step #2: Notify the Necessary Parties 

Effective communication is the key to a successful employee exit process. 

Notify all relevant parties within your organization about the departure. This includes HR, IT, department heads, and any other teams or individuals directly involved. 

Share the departure date, key milestones, and responsibilities. Providing contact information for the departing employee and their manager to ensure a smooth transition and minimize misunderstandings.

Step #3: Legal Matters

Legal considerations are an inevitable part of the offboarding process. 

Review and address crucial legal documents and agreements, including non-disclosure agreements (NDAs), non-compete clauses, and severance agreements. 

Ensure departing employees understand their ongoing obligations regarding the protection of company confidential information. 

This step not only protects the organization but also provides clarity to the departing employee.

Step #4: Return of Company Property 

Creating a systematic process for collecting company property is more than just a formality. 

It includes collecting laptops, mobile devices, access cards, keys, and any other physical property issued to the employee. Clearly communicate the items that need to be returned and provide a timeline for this process. 

Documenting the return of property ensures an accurate record and prevents potential issues down the line.

Step #5: Knowledge Transfer

One common challenge during offboarding is the potential loss of knowledge when an employee leaves. 

Encourage departing team members to document their roles, responsibilities, and any ongoing projects. 

This knowledge transfer ensures that their tasks can be easily transitioned to other team members. Consider creating step-by-step guides or documentation for important processes. 

Updating training materials and having a place to learn minimizes workflow disruptions.

Step #6: Exit Interviews 

Exit interviews are a valuable opportunity to gain insights. Conduct exit interviews with departing employees to understand their reasons for leaving. 

Ask questions such as:

  • What prompted your decision to leave?
  • What parts of the organization did you find most satisfying?
  • Where do you see opportunities for improvement within the company?

Exit interview feedback provides valuable information about areas that may need improvement, both in the offboarding process and within the organization.

Step #7: Financial Matters 

Addressing financial matters tied to the departure is crucial for providing a positive offboarding experience. 

Ensure that the departing employee receives their final paycheck, including any unused vacation or sick leave. Provide information on the employee benefits, such as health insurance or retirement plans, if applicable. 

Settle any outstanding reimbursements, including expenses or owed bonuses. 

Transparent communication about financial matters fosters trust and contributes to a positive offboarding experience.

Step #8: Technology Access

Data security is paramount, especially when it comes to departing employees. 

To protect sensitive information and maintain security, revoke access to company systems, email accounts, and files. 

Collaborate with the IT department to ensure that technology access is secure or terminated as needed. This step is vital for safeguarding company data and preventing potential data breaches.

Step #9: Farewell and Appreciation

Departing employees have contributed to your organization, so making them feel valued is essential. 

Consider organizing farewell lunches, gatherings, or small ceremonies to acknowledge their contributions and wish them well in their future endeavors. 

Provide personalized thank-you notes expressing gratitude for their contributions. Consider small gifts or tokens of appreciation, such as company-branded merchandise. 

These gestures leave a positive and lasting impression, turning the farewell into a moment of appreciation.

By meticulously following these nine steps, you’re creating a seamless, respectful, and thoughtful employee exit process. 

It’s an investment that benefits both the departing employee and contributes to your organization’s growth and reputation. 

10 Ideas to Include in Your Employee Exit Procedure

Now that you know how to create an employee exit process that works, here are ten actionable ideas to improve your exit procedures:

Idea #1: Holistic Onboarding and Offboarding Comparison 

Before diving into the exit process, take a moment to reflect on your organization’s onboarding experience

Identify elements that worked for your onboarding process. Then, integrate these successful onboarding components into your exit procedures.

That creates a holistic employee journey from onboarding to exit procedures.

Idea #2: Flexible Exit Interviews 

Recognize that each departing employee is unique, and their preferences for sharing feedback may vary. 

So, offer flexibility in exit interviews. 

Whether it’s a face-to-face conversation, a written questionnaire, or a virtual meeting, providing options ensures that employees can express their thoughts comfortably.

Idea #3: Benchmarking Exit Data 

According to Fiverr, making the best decisions for your business, achieving your goals, and overcoming potential problems can all be attributed to business data analysis.

So to continuously improve your offboarding process, track and analyze data over time. 

Pick the right HR Metrics to identify patterns, common reasons for departure, and areas that need improvement. 

This data-driven approach empowers you to make informed decisions, ensuring that your offboarding process remains agile and responsive to the evolving needs of your organization.

Idea #4: Personalized Offboarding Plans 

Acknowledge the individuality of each employee by tailoring the offboarding process based on their role, contributions, and reasons for leaving. 

82% of employees say it’s important for their organization to see them as a person, not just as an employee

So, a personalized approach demonstrates genuine care and consideration—further contributing to a positive farewell experience. 

Consider factors such as the employee’s tenure, accomplishments, and future aspirations when crafting a customized offboarding plan.

Idea #5: Knowledge Transfer Workshops 

Move beyond traditional documentation by hosting knowledge transfer workshops. 

Encourage departing employees to share their expertise directly with team members. This interactive approach not only ensures a smoother transition of knowledge but also promotes collaborative learning within the team. 

Schedule these workshops strategically to maximize impact.

Idea #6: Post-Exit Surveys for Former Employees 

Extend your data collection beyond the exit interview by implementing post-exit surveys. 

Send these surveys to former employees after they’ve settled into their new roles. This ongoing feedback loop provides valuable insights into their long-term experiences. 

As a result, you’ll gain more insights about your organization’s culture, work environment, and leadership that may impact employee satisfaction and retention.

Surveys are also a fairly low-cost and straightforward way of gaining insights into how employees feel about a given topic.

Idea #7: Assign a Dedicated Task Force for Offboarding

Establish a task force that analyzes data and implements improvements. 

This proactive approach ensures that your offboarding process remains agile, responsive, and aligned with the evolving needs of your organization. 

The task force can meet regularly to review exit data, identify trends, and propose targeted enhancements to the offboarding experience.

Idea #8: Exit Process Documentation 

Create a comprehensive yet user-friendly guide for exit management. 

Include step-by-step instructions, templates, and best practices. This documentation ensures consistency in execution across different teams. 

Regularly update this guide to reflect any changes in procedures or best practices.

Idea #9: Mentorship Program for New Hires 

Leverage the knowledge and experience of departing employees by introducing a mentorship program for new hires. 

This program helps new team members fit into their roles more efficiently. Encourage departing employees as mentors for incoming hires for continuous workflow and minimizing disruptions.

Idea #10: Performance Analytics Integration 

Use performance analytics in your exit process to gain deeper insights. 

Evaluate the departing employee’s performance data against broader team trends. This insight helps identify areas of improvement in talent management and development

By analyzing performance data, you can make informed decisions to enhance your organization’s overall performance and employee satisfaction.

By incorporating these ten detailed ideas into your employee exit management, you’re not just following a checklist; you’re creating a more thoughtful, data-driven, and effective exit process in HR.

3 Crucial Tips for the Best Employee Exit Management

We’ve covered the steps, and we’ve covered our favorite ideas. But regardless what your process looks like, don’t forget these 3 “golden rules” for exit management:

Tip #1: Emphasize Employee Well-being 

While the focus is often on the employee exit paperwork, don’t overlook the emotional well-being of the departing employee. 

Recognize their contributions, express gratitude, and provide resources for managing the transition. Demonstrating empathy goes a long way in creating a positive lasting impression.

Tip #2: Encourage Knowledge Sharing 

Facilitate an environment that encourages departing employees to share their knowledge before leaving. 

You need the information in their brain.

Whether through documentation, informal discussions, or knowledge transfer sessions, preserving knowledge ensures a smooth transition for the team and minimizes disruptions in workflow.

Tip #3: Flexible Exit Timelines 

Acknowledge that each employee’s situation is unique. 

Where possible, offer flexibility in exit timelines. This not only accommodates the departing employee’s needs but also allows for a more seamless handover of responsibilities. 

A rigid approach can lead to unnecessary stress for everyone involved.

By incorporating these additional tips into your employee exit management strategy, you go beyond the typical routine. 

These simple yet impactful practices contribute to a workplace culture where even goodbyes are handled with care. 

Create Your Employee Exit Process That Works!

Now, it’s time to tailor them to your company’s unique needs. 

Utilize these strategies as a foundation to create an employee exit process that meets requirements and leaves a positive mark.

As you create your employee exit process, remember that even farewells can be opportunities for growth. 

Continually refining your employee exit process ensures it aligns with your organization’s evolving needs, contributing to a positive employer brand.

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