The emotional effect of an employee’s departure may make it easy to overlook the many details that must be attended to, so it makes sense to create a checklist in advance. With this in mind, perhaps the first item to place on an employee departure checklist list is: if you don’t already have a checklist, make one as soon as possible. Then, have suitable personnel review it so that when the time comes, the list will be ready to use.
A paper form may have underlines and/or boxes to allow for signatures, initials, dates, and checkmarks to make sure each item has been covered. Alternatively, it may be first prepared as a computer form, for example in Excel or Word, and printed out after it has been completed. Checklists may be found online, for example from HR organizations and chambers of commerce as well as vendors. It may be worthwhile to pay for a checklist that has already been prepared and reviewed.
When using the list, it may not need to be completed in top-down order. For example, if an employee stays two weeks after giving notice, turning over keys, access cards, and similar items may be their last step. With these caveats in mind, here is a five-item list of the steps that need to be taken.
Final Paycheck and Benefits Package
The first items on the checklist are the things the departing employee will be taking with them. Two key items are the last paycheck and statement-of-benefits packet. If the last paycheck is prepared (or double-checked) in house, there is no shortage of items that may apply. Categories include 401Ks, advances, bonuses, commissions, ERISA, expenses, IRAs, loans, severance (if any), sick days (if counted), taxes, withholdings, and accrued vacation and leave days on the date of departure. You will also need to consider state laws when issuing a final paycheck.
- California law governs when and where the last paycheck may be given to the employee. Labor Code § 202(a) states: “If an employee not having a written contract for a definite period quits his or her employment, his or her wages shall become due and payable not later than 72 hours thereafter, unless the employee has given 72 hours previous notice of his or her intention to quit, in which case the employee is entitled to his or her wages at the time of quitting.” Further, Labor Code § 208 states: “every employee who quits shall be paid at the office or agency of the employer in the county where the employee has been performing labor.” Some general guidelines for California employers regarding the last paycheck may be found here and here.
- In Colorado, Colo. Rev. Stat. 8-4-109(1)(b) states: “ When an employee quits or resigns…the wages or compensation shall become due and payable upon the next regular payday.” General guidelines may be found here and here. New York and Texas have similar laws that provide that the last paycheck of an employee who quits is due on the next regular payday after termination.
- Florida, in contrast, has no laws governing when and where the last paycheck is due. Employers should provide the check on the next pay period.
In many states, employees who are fired are due their last paychecks in six days, however. In addition, other laws may apply for layoffs.
The statement of benefits for which the employee is eligible must also be provided. This packet may include information about the employee’s 401K participation, COBRA, insurance continuation (disability life, etc.), IRAs, retirement benefits, tax benefits, and veterans’ benefits.
What Goes in the File
The second item to address is the documentation that will go in the employee’s file.
- The letter of resignation. The departing employee should provide or be asked for a confirmation of departure, which can take the form of a short letter that is signed and dated and states the employee’s departure date. You may also want to ask for the letter to state why the employee is leaving. If the employee does not give a reason at the time of termination, they may later seek unemployment benefits, for example by claiming constructive discharge, or they may sue, claiming discrimination, harassment, or other illegal conduct by the employer. This is why it is advisable to create a contemporaneous record of the employee’s departure and the reason given for doing so.
- In addition to the resignation letter, the employee may be asked to fill out or check a form to update and/or confirm the employee’s address, telephone, and emergency contact information so that W2s, benefits statements, and other notices go to the right address.
- A confidentiality and/or a nondisclosure agreement may also be needed. The employee may already be bound by a law or agreement, but a reminder or new agreement may be in order.
- Finally, a record of the departure interview should be prepared for the employee’s file. More on that below.
- Once completed, the checklist itself should be placed in the employee’s file.
Keys and Passwords
The third item on the checklist is what the employee returns to the employer. It may be helpful to think of two categories: physical objects and nonphysical things. Physical objects may include badges, books, computers, debit, credit, and phone cards, keys, key cards, pagers, phones, physical calendars and client information, tools, uniforms, and vehicles. When the employee leaves, the employer will need to cancel the former employee’s employer-provided credit cards, if any. The employer may also need to inform a landlord so that they may cancel the employee’s access to the employer’s building and parking lot. The employee will need to supply nonphysical objects such as passwords to the employee’s computer and phone, as well as network and/or subsystem passwords, including the employer’s social media accounts. The employer should also see to it that the employee is removed from the company’s websites and social media. Finally, the employee should be removed from the company’s printed materials at the earliest opportunity.
Fourth, after having gathered the checklist and as many items for the departing employee as can be obtained in time (such as the last paycheck and a benefits packet), the employer should conduct an exit interview. The record of the interview should be added to the employee’s file.
If possible, the interview should take place in a neutral place, such as a conference room, and it is advisable that two employees of rank greater than that of the departing employee be present. In addition to confirming the departure date and asking if the employee has any questions, the interviewers should consider asking a few open-ended, nonleading questions about why the employee is leaving. After asking why the employee is leaving, other questions may include: “Are there any problems we should know about before you leave?” “Did anyone in this company harass you, discriminate against you, or retaliate against you?” “Were you injured on this job?” If the answers to such questions are no, this should be noted in writing. If the answers to such questions are yes, follow-up questions should be asked, and possibly an investigation should be begun. Maintain a positive and professional tone.
Tell the Staff
Fifth, announce the departure and departure date to the staff and spare them the details. Arrange for other employees to cover the departing employee’s workload and notify affected departments and employees with a simple message that details whom the remaining employees may contact with questions.
Finally, this checklist only offers a broad overview of what to attend to when an employee leaves voluntarily. If an employee asks for a letter of reference or service letter, the employer should be aware of the state and federal laws governing references. And if an employee is fired or laid off, additional and/or different laws will need to be followed.