Letting Someone Go Properly
Performance management and exit conversations done fairly and legally.
Notes from Randall Harper. Thirty years working alongside owner-operators, executives and boards — companies of all types and sizes — across entertainment & media, hospitality, service based business, lifestyle businesses, financial services, retail and not-for-profit, in Australia, Asia, the United Kingdom and the United States. What follows is the thinking I keep returning to.
The hardest job in the business
Letting someone go is one of the most difficult things an owner ever does, and one of the most important to do well. Done badly, it damages the team's trust, the departing person's dignity, and often results in expensive legal disputes. Done well, it protects all three. The discipline is to act earlier, with more care, than feels comfortable.
Performance management, properly
- Name the specific behaviour or output that is not meeting standard.
- Document the conversation in writing, including agreed actions and timeframes.
- Provide genuine support — training, mentoring, clear expectations.
- Review progress at the agreed time, honestly, in writing.
- Escalate to formal warnings if the issues persist, with HR or legal advice.
- Move to termination only after genuine opportunity to improve.
The legal floor
In Australia, employees with more than six months' service (twelve in small businesses under 15 employees) have unfair dismissal protections. Even outside those protections, anti-discrimination and general protections laws still apply from day one. Before any termination, take advice from an employment lawyer or an industrial relations specialist. The cost of an hour's advice is dramatically less than the cost of an unfair dismissal claim defended badly.
The conversation itself
Hold the conversation in private, with a witness present. Be clear, calm, and brief. State the decision, the reasons, the next steps, and the support being offered. Do not negotiate; the decision should have been made carefully before the meeting. Allow the person to respond, but do not get drawn into rehashing past decisions. Most badly handled terminations are botched in the meeting itself by owners who soften, ramble, or backtrack.
Look after the team that stays
After someone leaves, the rest of the team will be watching — not the words you used, but the dignity with which the person was treated and the honesty of the communication. A short, respectful explanation to the team, without breaching the departing person's privacy, helps everyone move forward. Done well, a difficult termination can actually strengthen the team's trust in your judgement. Done badly, it can take a year to repair.
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The contents of this paper are the opinion of Clear Point Advisory only. Readers should rely on their own judgement and obtain professional advice appropriate to their circumstances.