Employee Offboarding Process: Definition and Main Steps

Employee Offboarding Process: Definition and Main Steps

Employee Offboarding Process

It’s usually perceived that employee onboarding is the only important part of handling employees and must be given all the attention. But, it’s essential that, as HRs, employee offboarding is given equal importance. In this article, we will discuss the concept behind employee offboarding and how important it is. 

Offboarding Definition: What Is Offboarding? 

Employee offboarding is a required procedure or practice when an employee leaves a particular company for voluntary or involuntary reasons. It’s an essential process to maintain the reputation of the company or organization, optimize its current worker’s working experiences, and preserve potential networking opportunities. It leads to the official and formal separation of a company and an employee through retirement, resignation, or termination. 

The offboarding process may include: 

  • Assigning and transferring the duties and responsibilities of the employee to another employee
  • Giving back and turning in used working equipment
  • Deactivating and disabling the employee’s access to passwords and rights of the company
  • Doing exit interviews to collect feedback from the leaving employee

Technically, employee offboarding guarantees that there are no complications when an employee leaves for good. So you won’t have to email and run after them after some weeks for some things such as their ID badge. Additionally, it’s a way to earn insights on improving the working experience of those who’re still in the company or organization. 

Importance of Employee Offboarding 

Employee offboarding may seem unnecessary, but it’s not. When an employee leaves your company, they have the potential to be either an antagonist or an advocate of your company. And you must know that your work isn’t done after their termination or resignation. There are more things you’re responsible for doing. And HR will have to handle all paperwork aside from the teams assigned for the other processes. 

The effects of proper offboarding are huge. A proper employee offboarding helps companies: 

  • Mitigate financial and security risks - without offboarding, incorrect payments to the employee who left might continue. Also, it helps to reclaim assets and revoke the employee’s access to the company’s accounts. 
  • Manage legal issues - proper handling and signing of all documentation after resignation or termination prevents problems such as contract disputes and compensation and avoids lawsuit risks.  
  • Maintain good terms - parting on good terms and leaving an excellent final impression is also important. 
  • Manage logistics - transitioning for the team and the other employees will be more manageable when the employee leaves. 
  • Collect valuable feedback - leaving employees with much knowledge regarding the company provides valuable feedback about the company and their experience, which can improve the company. 

Who Are the People Involved in Employee Offboarding? 

When an employee decides or is made to leave the company for specific reasons, they communicate with the company to leave on good terms. Specifically, there are certain groups of people that are involved with: 

  • Human Resources (HR) Team - they will manage and initiate the flow of the offboarding process. Updating the company chart is also their job. 
  • Information Technology (IT) Team - they’re assigned to recollect the company’s assets such as work equipment like laptops, company credit cards, key cards, and more. They also terminate the ex-employee’s access to the company system, such as work email and tools. 
  • Finance Department/Team - they will process the final paycheck for the employee
  • Recruitment Team - they initiate and evaluate the recruitment process to fill in the position the employee will leave. 
  • Leadership Team - they’re included for transparency. 

Difference Between Employee Onboarding and Offboarding

Employee onboarding and offboarding are both essential phases of an employee’s stay at any company. From the terms themselves, onboarding pertains to the process an employee goes through as they join the organization, and the offboarding is for when they leave. 

Although it may vary for every company, employee onboarding is the process when new employees are introduced and join the organization or company. And this usually takes about a day up to 18 months, depending on the company, but mostly the process starts after the offer letter is sent to the soon-to-be employee. 

Employee offboarding, on the other hand, is a process done when an employee is leaving the company. It includes procedures that basically take back what was given to the employee and accompany them in leaving the company, so they part in the best possible way. 

See, the very difference between the two is that one is done as an employee joins the company while the other is done as they leave. And both include different sets of procedures but most likely the same people. 

The Employee Offboarding Process - Main Steps and Checklist

A strong and smart offboarding process is important to ensure that everything goes well when an employee leaves. For example, it can inflict some financial consequences to the company or organization, just like what happened with the University of Wisconsin. During the fiscal year of 2011-2012, the university overpaid about $15.4 million in health insurance premiums, and most of those were paid for employees who aren’t working there anymore. 

Employee offboarding ensures that the company covers all security gaps. And a strong offboarding process includes these steps: 

1. Create an Offboarding Checklist (for HR)

A checklist is a very helpful material for the HR department during the offboarding process. Below is what things or to-dos can be included in a checklist: 

  • Get the letter of resignation from the employee
  • Give the employee a written acceptance letter for their resignation 
  • Schedule the employee for a meeting with the HR for out-processing
  • Filling in the HR database of the employee’s termination details and information 
  • Process outstanding expense reimbursement if there are any
  • Confirm and ensure that the employee doesn’t owe reimbursement of bonuses
  • Check if the employee took an accrued leave
  • Provide the employee their own offboarding checklist

2. Creating an Offboarding Checklist (for the Employee)

It’s also helpful if the employee himself is given a checklist as part of the whole process to make everything easier and avoid troubles. An employee’s offboarding checklist may include: 

  • Settle all or any cash advances or unsettled accounts
  • Ensure that all significant records are organized and labeled for whoever will take over their position
  • Collect and remove all personal items in the office and lockers 
  • Return all company assets or things such as keys, keycards, parking permits, company credit cards, and more. 
  • Give a valid forwarding address so mail can be forwarded.

3. Documentation and Collection of Information

Aside from the previous steps, this step is the official start of the formal and technical offboarding process. The first thing is to have the employee sign and complete a formal resignation letter. After this, the HR manager or the supervisor must review and check all the documents that the employee has completed and signed during their stay in the company. These documents may include benefit documents, non-disclosure agreements, confidentiality agreements, severance packages, etc. 

Additionally, ensure that the employee states in their resignation letter when their last working day is and the day they want their leave. 

4. Inform the Accounting or Finance Department

In this step or stage of the process, informing the accounting or the finance team is essential so that they can prepare all necessary documents and things such as tax documents and their last payroll. Informing them will also allow them to calculate if the employee has any outstanding reimbursements, their vacation days and prepare any compensation required. 

5. Communicate With the Other Employees

Once the respective personnel or authorities are notified about the employee leaving, the person in charge, the manager, or whoever holds the authority and duty to do so must notify the other employees as soon as possible. A notice may be an email or announcement or whatever is deemed appropriate and must include details such as: 

  • Who will be leaving, and when is their last day at work? 
  • When will there be a job requisition open for their replacement? 
  • Who’ll possibly take over their duties and responsibilities? 

Although this might not be important for some companies, notifying other employees is a good practice, especially before the other employees fill in the details themselves, gossip, and cause miscommunication and fake news in the working place. This is usually done at least a week and a half before the date the employee leaves the company, depending on their position and role in the team.

6. Plan Transfer of Position

This is an essential part of the process since this focuses on creating a handoff plan so that a smooth transition will be possible. The plan will be all about wrapping up and finishing any remaining existing tasks while laying the groundwork for whoever will take over the position or role at the same time. This can be referred to as the transfer of knowledge stage. A clear understanding of how the workload will be transitioned and priorities shifted is an essential part of the stage. 

Here are some essential questions to ask while planning: 

  • Who will replace the employee and take over all the left workload and role? 
  • What training will be needed by the replacement? 
  • What are the deliverables? 
  • Who is going to train the new employee? 
  • Which projects and tasks are needed to be completed before the employee leaves? 

Moreover, it’s best to collect the knowledge from the outgoing or leaving employee themself. Here are some questions you can ask them so that you can plan the knowledge transfer properly: 

  • Are there any systems that the employee, who will take over your position, needs to train for? 
  • What files do they need access to and have to know about?
  • Can you share your daily routine in detail through a step-by-step guide? 
  • What tasks in your position must be prioritized? 
  • Who do you regularly contact, both outside and inside the company, that we must inform of the transition? 

7. Communicating With Clients

There are cases where the employee who’s planning to leave has been working directly with clients. In cases like these, it’s important to notify these clients. Most importantly, when you communicate with them and notify them about the departure of the employee, clearly state or assure the client that the company will continue working with the client and they will still be taken care of even if the person in the position changes.

8. Collect Assets

Employees are usually given items by the company, and during their stay, they may have acquired a number of them. Days before they leave, it’s important that you collect all the items. These items belong to the company property and can be anything like mobile devices, laptops or computers, keys, ID badges, uniforms, company credit cards, etc. You can have a different and separate inventory checklist for the items you need to collect for every outgoing or leaving employee, so it’d be easier to collect and organize them. 

9. Conduct an Exit Interview

Exit interviews serve the purpose of collecting valuable feedback on the experience the employee had while working in the company. It’s the last opportunity any company has to leave a positive impression. Also, from this interview, you can also collect information from the employee’s answers that might be able to help the company in management and making better decisions in the future. 

However, it’s important that you ask the right and appropriate questions so that the valuable information and insights you can gather for the company will be useful in terms of the company’s strengths and weaknesses and ways to improve. 

Here are some questions that are usually asked in an exit interview: 

  • In terms of the culture of the company or the organization, how would you rate it? 
  • Has internal politics ever impeded your work abilities to effectively do your job? 
  • Why did you decide to look for a new job, and when did you? 
  • Do you think the responsibilities are divided fairly and well among your co-workers? 
  • Did you receive enough resources to do your job? 
  • How would you rate the intensity of your workload on a daily basis? 
  • Would you consider recommending this company to any of your friends? Why or why not?
  • What should we prioritize for improvement? 
  • Could we have done something that would help convince you to stay? 

Now, remember that there are times that managers are sometimes the sources of conflict, so you might want to consider neutral third-party personnel to do the interview to prevent the employee from feeling uncomfortable. Also, it’s important to assure them that all of their answers will be kept confidential and anonymous, and you’re going to investigate any issue they may say. 

In an exit interview, you might not get the positive answers you wish for. There might be some criticism. Don’t belittle and set aside those critiques. And if you ever notice the same issues and problems being mentioned by every employee who leaves, you can resolve these issues to improve employee retention.

10. Revoke the Employee’s Access to Any Account

Aside from the company property and items that you should collect from the leaving employee, their access to any company-issued accounts must be revoked. It doesn’t matter if the employee had a good relationship with the company and other staff. This is mainly for security reasons. Leaving or outgoing employees must no longer have any access to emails, platforms, and any other company databases to secure the data of the company. 

11. Bid Them Goodbye

A farewell is never a bad idea whenever an employee leaves the company. However, it may depend on the reasons as to why they’re leaving. A farewell gives a positive impression both to the leaving employee and the current employees of the company. 

Sending them off like this also shows that you valued what the employee has contributed to the team and to the company as a whole. Bidding goodbye can be of many forms, such as throwing a party for them, giving the employee a gift, or even simply writing a thank you would suffice. Also, you can send a farewell announcement on their last day at the office to remind the other employees and the rest of the team to wish the one leaving a heartfelt farewell. 

12. Keep in Touch 

Burning bridges with a former employee isn't always a good idea. It’s advisable and is a good practice to follow up how your ex-employee is doing, even if it’s through LinkedIn. There are benefits when you maintain a positive and good relationship with them even after their departure from the company. 

The Offboarding Process and Employer Brand

Understanding employees’ experiences shouldn’t be just done during an employee offboarding. Efforts to make strong relationships and connections between the employer and the employees must be continuous and not just during an onboarding process. Employees will be very much interested in what future they will have with their company. 

A company’s figure or reputation in the eyes of job seekers, the employees, and society is what an employer brand is. An effective and good employer brand is vital for recruitment. However, remember that an employer brand isn’t just for onboarding. It’s during an employee’s whole stay and experience in the company and during offboarding that the employer brand is reflected truly. 

What Affects an Employer Brand?

According to Execu|Search’s report in 2019, 86% of professionals stated that they'd be most likely to change their jobs if they're offered more opportunities for professional development, and 45% said that they don’t feel like enough healthy work-life balance is promoted by their employer. Additionally, Fortune reported back in 2018 that most employees, mostly in leadership positions, quit and leave their jobs for new job opportunities, not because of money, not enough salary, or such, but because of boredom and long working hours. 

Employer brand can be affected by employee engagement all throughout an employee’s experience. And based on these statistics, their reason for leaving is usually due to engagement in their workplace. 

Also, nowadays, there are more job openings than there are job seekers. Even though a company can control how their company will be presented, employees themselves have a significant impact on your employer brand or reputation. From Software Advice’s study, an average of 50% of job seekers first check a review about the company’s jobs through various sites, such as Glassdoor, before they apply. If you think about it, it makes sense since nobody would ever want to waste their time and effort applying to a company with a one-star review. 

How to Improve Employer Brand

Every decision the company makes can affect its employer brand. Recruiting employees and giving them salaries and benefits aren’t going to keep them from leaving. A consistently positive experience in every aspect and department of the company during an employee’s whole stay in the company will help you build a positive and good employer brand. 

Additionally, regular and relevant communication between the employer and the employee is one way to give them positive and great experiences. Asking their insights, difficulties, and insecurities and acting on them will help for improvement. The HR department must understand this very well. Not all workplace issues can be solved by covering them up. They need to be resolved. In order to create a healthy workplace, issues must be recognized, employees must be heard, and measures should be taken for growth. 

Lastly, offboarding is a company’s final chance of showing the values of the company to their leaving employee, to prove to them that the company is true to what it said it is. And an effective and good offboarding is a good final touch to give that employee an experience that’s as positive as it can be. 

Simplify Employee Offboarding With Lanteria HR

The employee offboarding process isn’t simply a technical and formal procedure that a company must do. It’s more than that. There are many things HR can acquire from offboarding, either positive or negative. But whichever can help the company improve and grow for their current employees and build a positive employer brand. Since the last step of the process is keeping in touch, there are times that ex-employees become “boomerang” employees, which implies that they come back to the company after going on a different part. Remember that it’s not always about onboarding. Offboarding must also be given utmost attention. 

In line with this, for a more efficient and collected offboarding process, there is now various offboarding software available online such as Lanteria’s Core HR software. Lanteria has developed an all-around software that covers and helps in mostly all of the tasks of the HR department, such as offboarding.

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