What to do When Employees Quit

When employees quit, businesses or HR managers should take certain steps to make the transition as smooth as possible.

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When employees quit, businesses or HR managers should take certain steps to ensure they are in compliance with all employer laws and make the transition as smooth as possible for both the outgoing employee and remaining employees. An experienced HR manager or Professional Employer Organization can provide valuable support during these transitions.

What to do When Employees Quit

Here are the seven things that employers should do when an employee gives notice of their intent to quit (two weeks’ notice is standard):

  1. Get a resignation letter on file

In order to protect the employer from a false claim that they terminated the employee, employers should ensure that they have a resignation letter on file that confirms the employees’ intent to quit along with a date and signature. If you can’t get the employee to create a resignation letter, document the reasons for the separation and keep the record in the employee’s personnel file.

2. Gather relevant documents

HR should gather and deliver the documents the employee is entitled to have when they leave the company such as:

  • COBRA insurance information
  • Benefits end date/payouts
  • Unemployment eligibility

HR should be ready to provide personnel files if the employee asks for them after termination.

How long should you retain personnel records after employees leave your company?

EEOC Regulations require that employers keep all personnel or employment records for one year after an employee leaves your company. Under ADEA record keeping rules, employers must also keep all payroll records for three years as well as any employee benefit plan and any written seniority or merit system for the full period the plan or system is in effect and for at least one year after it has been terminated.

Form I-9 records should be retained for three years from the date of hire or one year from the date of termination, whichever comes later.

3. Make a plan to shift the employee’s responsibilities

When an employee quits, they are leaving behind all the tasks they were taking care of on a daily basis. As a business owner, you will need to temporarily reassign or take over that employees’ tasks until a replacement can be found or promoted into the role. If you are not able to get a clear list of tasks from the outgoing employee, their direct supervisor should be able to come up with a list and delegate tasks.

4. Conduct an exit interview

Employees who are about to leave a business are more likely to be honest about what they didn’t like about working for you. Toxic manager? Unrealistic expectations on project deadlines? Lack of flexible work options? Whatever feedback is given provides an opportunity to make changes that can improve the company culture and working conditions for the remaining workers.

5. Schedule access restrictions and collect any company property

Before an employee leaves on their final day, their email address and access to company software and client accounts should be scheduled for termination. The following items should also be collected:

  • Keycards that provide access to the building
  • Company laptop or phone
  • Uniforms
  • Company credit cards
  • Etc.

6. Announce that the employee is leaving

The employee’s direct team should be notified as soon as possible about the upcoming departure of their teammate – along with the plan for covering their workload until a replacement can be found. Depending on the role, it may also make sense to communicate the departure to customers, clients, and vendors and the company as a whole.

Always share the news in a respectful way, being careful not to share any private information. Decide whether it makes sense to communicate the news in a meeting or by email (or both).

7. Make the final payment

Under Section 388-3(b), when an employee quits or resigns in Hawaii, the employer shall pay the employee’s wages in full no later than the next regular payday, except that if the employee gives at least one pay period’s notice of intention to quit, the employer shall pay all wages earned at the time of quitting.

What to do if an employee quits without notice

If an employee quits suddenly without giving notice, it can be a challenge to take care of the steps on this list. Complete as many tasks as you can. If there is concern about the employee taking company property or they have refused to provide a resignation letter, it’s a good idea to speak with an HR or legal professional to discuss your options.

Partnering with Makai HR

Need HR support for your small business? We’ve got you covered through HR outsourcing! When you partner with Makai HR you can get on with the business you are trying to grow while we take care of your employee needs from payroll to taxes, health insurance/benefits and worker’s compensation. You also gain peace of mind that you are compliant with all of Hawaii’s employer laws (if you’ve ever looked you know that the list is very long and changes happen). When choosing a PEO to partner with, there are many things to consider including cost, services, and technology solutions. 

With the cost of doing business in Hawaii at record highs, we know how important it is to keep labor costs in line with revenue. Our plans are priced competitively and include value-added services like time-in/time-out systems. Our three tiers of PEO service plans are tailored to the size of your business and specific needs. We offer a 100% paperless solution which means that your employees can manage their needs through a computer, tablet, or phone. We can truly improve your employees’ work benefits while freeing you up to operate your business.

What are you waiting for? Companies that partner with a PEO benefit from 7-9% faster growth, 10-14% lower employee turnover; and they are 50% less likely to go out of business. Contact us today to get started!

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