Best Practices for An Effective Employee Offboarding Process

Employee offboarding refers to the systematic and consistent way of managing the exit of an employee without affecting the normal running of an organization.

The Meetingnotes Team
March 5, 2024

Most organizations invest time and financial resources in the recruitment and onboarding process. However, the same organizations take a back seat in the offboarding process. With less attention and effort to the exit process, organizations risk exposing themselves to unnecessary legal and security threats.

Employees remain a vital asset to any organization even when they no longer work in the organization. After leaving your organization, employees become your brand supporters or adversaries, boomerangs, or trusted referees for your future employers. Overlooking your exit management process prevents your organization from getting valuable feedback that can help improve flawed aspects of the operations and organizational culture. Beyond this, a well-managed exit process shows your employees that you value them beyond their time and efforts at your company, even as they pursue their career goals.

In this article, we’ll be covering an effective employee offboarding prcess, allowing your team members to get the maximum benefit from this often overlooked process.

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What is Employee Offboarding?

Employee offboarding refers to the systematic and consistent way of managing the exit of an employee without affecting the normal running of an organization. Offboarding is the process that manages employees' experience at the end of their tenure, either through resignation, termination, or retirement.

The HR team is responsible for the offboarding process, and it should be a seamless transition for both the organization and employees. The process ensures there are no essential tasks under the purview when the employee leaves the company. All paperwork is properly documented, and all dues are cleared. Offboarding ensures that all loopholes are plugged in, eliminating the possibility of calling a former employee months after leaving the organization to ask for the information needed in their department.

Offboarding consists of all the steps and choices that take place when an employee is leaving, including;

  • Transfer of responsibilities
  • Deactivating system access rights and passwords
  • Turning in equipment
  • Conducting exit interviews to gather feedback

Failure to have a proper exit management strategy means many vital tasks will fall through the cracks, information may be mismanaged, and onboarding a new hire could be a hassle.

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Why Is Employee Offboarding Important?

Exit formalities are important to both employers and employees in different capacities. Research from Aberdeen shows that only 29% of organizations have a formal employee exit strategy, which means 71% do not offer an easy transition process. The trend is even harder when hybrid work models have gained popularity, and few organizations are likely to offer a positive offboarding process for remote workers. However, the same study also reveals that companies with laid down procedures for the offboarding process realized greater growth, retention, employee engagement, and improved performance.

1. Former employees can become future employees.

Employees leave companies for a myriad of reasons, among them lack of growth opportunities, salary and benefits, and failure to provide a conducive work environment. However, in organizations with an effective offboarding process, employees may return to higher-ranking positions with their former employers after a certain period.

Rehiring former employees has its advantages for both the organization and the employee. Boomerang employees already know the company culture and the processes, procedures, and systems that save an organization cost in training new hires. They reduce the risk of a cultural misfit and quickly reach their OPL (Optimum Productivity Level).

In addition, former employees bring a new perspective to the organization, which can help the organization achieve its objectives faster. In turn, this can boost the morale of existing employees for increased productivity.

2. Former employees are ambassadors.

Former employees are vital brand ambassadors for your organization. In modern society, there is a stereotype around goodbyes that prevents organizations from realizing the true value of their employees. Alumni networks and social media platforms are powerful tools that employees use to discuss employers and recommend brands to their peers. 92% of consumers believe in recommendations from friends and family over all forms of advertising. A study by The American Marketing Association and WOMMA revealed that 64% of marketing executives believed in word of mouth as the most effective marketing strategy, and only 6% have mastered its art.

Employees who have had a good experience are likely to recommend the company to a future employee and business opportunities and partnerships. Through word of mouth, employees can share information about new products of your existing products and job opportunities within their professional networks. Furthermore, employees may move into organizations where they can recommend your organization for partnership opportunities that would revolutionize growth in your organization. Finally, since they are already accustomed to your organizational culture, former employees may recommend potential hires who become essential company assets to your organization.

Changing how to say goodbye from the usual departmental clearance to proposing a continued partnership with former employees can make your employees brand ambassadors. Outplacement programs are critical to organizations, especially when it comes to maintaining positive relationships with former employees. Organizations should aim at helping employees safely transition from their companies to retain a lasting partnership.

3. Security

Improper offboarding of employees pose huge security risks to an organization. Whether a long-term employee resigned on bad terms, a contractor is not being utilized for a certain amount of time, or an employee goes on leave, improper offboarding or suspension of the user's permissions may cause a huge security risk. Malicious employees can sell your intellectual property to competitors or share important company data with other companies.

Deactivating user accounts and submissions of a company's resources may sometimes require responsible parties like the IT department to be available at the time of notice. Since not all employees have ample time to give notice, unforeseeable events can happen, forcing admins to scramble for the last minute to deprovision company resources from the user when company resources are already compromised.

4. Easier Compliance

Offboarding often exposes organizations to the risk of legal actions for noncompliance with issues like a data breach. Beyond the risk of the loss of data itself, improper handling of the offboarding process and removing old employees' access to sensitive company information can lead to HIPAA compliance. Ensuring that all HIPAA training certificates are maintained for at least six years will help in the event of a data breach or audit.

The HIPAA Security Rule 142.308(a) (11) details the required termination procedures. It gives the proper guidelines that would eliminate legal action within six years after an employee exits your company. The removal of access can be done through the following offboarding actions:

  • Withdrawing access to your system immediately on or even prior to termination.
  • Changing access codes, especially if one code is used by all staff
  • Disabling remote access to servers, software, and ERP systems
  • Ensuring that there are no storage devices or paper files containing personal information left in the employee's possession
  • Deactivating the employee from any user accounts such as servers and e-mails.
  • Blocking access codes, collecting keys, access cards or any other measures needed to change their access to your practice

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Employee Offboarding tools

Offboarding tools and software help your organization with creating a well-structured exit process. Most of the onboarding tools available in the market have offboarding functionality too. The type of tools and software adopted depends on the organization's goals and objectives. The tools vary from employee offboarding checklists and free tools to specialized solutions and chatbots. The benefits of having onboarding tools include

  • Map your organization's offboarding process with an integrated software solution
  • Speed up offboarding and clearance formalities with employee exit interview survey software
  • Provide a smooth offboarding experience for the exiting employees with existing employee exit management procedure
  • Analyse exit survey results and increase retention with the best exit interview software
  • Save on administrative costs with an online exit interview tool.

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Employee Offboarding Process Best Practices

1. Make the Experience Positive

For whichever reason an employee leaves an organization, the overall experience during their exit should always remain positive. In most organizations, the exit process is bureaucratic, with employees expected to manage multiple sign-offs from different departments in their last days in office. Oftentimes, employees are expected to engage with multiple stakeholders from within the company, some of whom they have not interacted with during their tenure.

Many organizations lack a well-defined exit process, which leaves employees frustrated. Creating a positive experience among departing employees may involve going beyond eliminating the bias to embracing them as part of your team. Digitizing the exit process with notifications and auto alerts to stakeholders through an inbuilt escalation mechanism that can help in the process.

2. Get Insight and Data

Exit interviews are a great avenue to collect data and gain insight into how employees perceive your organization. Not many organizations realize the value of talking to employees leaving their company, as many employers tend to create poor relationships when an employee resigns. However, exit interviews will benefit you in finding out the existing employees' experience and help the departing employees move on to their next step.

Take the chance to gain new insight into your organization. Departing employees tend to feel free to say what they have seen and experienced on the job without fear of reprisal. Hence, they are willing to give honest, insightful, and constructive feedback that you can use to improve your company culture.

Furthermore, an exit interview is an ideal opportunity to thank the employees for their contributions to the organization's progress and express interest in maintaining a relationship, perhaps by inviting them to join your employee alumni network. You can also explain details about benefits, references, and other matters that will ease the employee's transition.

3. Make Knowledge Transfer a Part of the Everyday

Knowledge transfer is an essential part of the offboarding process as it ensures the transfer of skills and knowledge to the next team. Knowledge transfer should commence immediately before an employee departs. While finding a new replacement can be challenging, a team member can take up the handover. The experienced staff have vast knowledge sets that go beyond the formal procedures of their daily tasks. You can get them to add their skills and knowledge to your LSM to ensure that knowledge remains a continuous process. LSMs, ensure that departing employees have already done the bulk of their handover and all their knowledge is safely ready for their replacement to study.

Make sure that the departing team member documents their tasks and responsibilities for reference by new employees. It would be an added advantage if they also got to meet and train their replacement. They can give them onboarding tips essential for the transition, which gives the new employee a better view of your company culture.

4. Stay In Touch

Even though you will be losing a valuable member of your team, this is a great opportunity to build networks. Staying in touch with your former employees through alumni networks ensures that employers and employees can maintain their future relationships. Communication shows your existing employees that you care and are willing to support them in their career growth beyond your organization.

Alumni and professional networks are increasingly becoming common platforms for both new and existing employees to share their views while seeking support and advice. Keeping former employees engaged, especially those that have been terminated, can help them perform better in their next ventures.

Give practical advice and necessary support while highlighting an employee's strengths and advising on the areas they need to improve. Or you can introduce them to people that may offer them a job in the future.

Digitize Your Employee Offboarding

The complexities involved in the offboarding process make bidding goodbye to employees a taxing affair. A wrong move can not only ruin the reputation of your organization but also jeopardize company data and result in fines for noncompliance. With the right technology tools, organizations can standardize the complexities in the exit process. Digitized offboarding allows organizations to configure the resignations, capture approval workflows, automate the clearance process, integrate payroll systems, and prepare a departmental exit checklist.

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