While employers generally understand the importance of on-boarding, specialist employment lawyers are highlighting the equal importance of off-boarding and ensuing a smooth transition period between the time an employee hands in their resignation notice and the day that they leave the business.
It can be a difficult and sometimes contentious time for employers between managing handovers, potential staff-shortages and fears of the employee disengaging, checking out or perhaps causing a negative impact on the business. “Off-boarding is a really important piece of work for HR departments and managers of companies”, said Sharon Latham (pic), a partner and employment solicitor at national law firm Clarke Willmott LLP.
“It must be handled correctly but it can also provide useful intel which may benefit the business going forward. If possible, when an employee resigns try and understand the reasons for leaving at this stage. Were there any grievances or contentious issues? If so, the employer should be wary of claims for constructive dismissal and try and resolve the employee’s concerns despite their leaving. If they are leaving for non-contentious reasons, consider whether it’s a unique reason or if other former employees have cited the same reason for leaving.”
The statutory minimum notice to be given by an employee with at least one month’s continuous employment is one week; the contractual notice period may be longer. It is important to check the contract of employment to confirm that the correct notice period has been given. Unless the contract provides otherwise, the notice period will run from the day after that on which the notice was given.
Next, decisions must be made on whether the employer wants the employee to work their notice period, receive payment in lieu of notice (PILON) or go on ‘garden leave’? Check the employment contract, for example, useful restrictions on an employee’s activities may apply during a period of garden leave or the entitlement to benefits may be affected by making a PILON as opposed to placing an employee on garden leave. Sharon continued: “Having a handover plan is hugely beneficial. Consider having a tailored checklist for your organisation so that you can ensure no part of the process is missed.
“Any outstanding annual leave entitlement should be considered, and it must be agreed how this will be dealt with. Payment in lieu of holiday is not usually permitted under the Working Time Regulations 1998, however there is an exception to this rule on termination of employment. If there’s a significant amount of leave remaining and this is taken prior to the termination date rather than paid in lieu, this could effectively reduce the amount of the notice period that is actually worked.”
Employers must also decide to whom the departing employee’s duties will be handed over, or whether it will be necessary to recruit someone new. If so, this should be done sooner rather than later and ideally with a crossover period for the departing employee to train the recruit/transfer knowledge. If remaining employees are taking on an additional workload to cover the departing employee, consider the impact this will have on them and whether it will constitute a change to the terms of their employment.
If the changes are not authorised by the employment contract, ideally the employer should seek the employee’s express agreement to the new terms. Sharon said: “For most employees, it will first be necessary to communicate their resignation to their team so that they can prepare for the handover and any staffing shortages. It may also be appropriate to communicate with the wider organisation to avoid any miscommunication.
“For resigning or retiring directors, consider the risk of holding out. Consider any statutory or commercial need to communicate the resignation e.g. to customers, suppliers and clients that the director had dealings with during their service and consider whether an internal or external announcement will be
required and in what terms.”
Then there is the exit interview. This will be the final opportunity to discuss reasons for leaving and it might be the first time that the employee feels comfortable talking candidly about their experience working for the employer. This can therefore be used as a learning tool for improvement and for future recruitment.
It’s important to get as much information as possible during the interview. There are GDPR restrictions against storing former employees’ data indefinitely or without good reason. This means that the employer cannot necessarily contact the former employee at a later date asking for more information. If they are contacted, the employee would not usually be under any obligation to engage once the contractual relationship has ended.
Before leaving the employee should be reminded of any ongoing restrictions upon them in their employment contract (e.g. restrictive covenants, use of intellectual property and confidential information) notwithstanding that their employment is ending. Bear in mind, that restrictive covenants that seek to restrict a former employee’s freedom to work must be reasonable and will be void unless it is designed to protect a legitimate business interest.
Ahead of termination consideration should be given to continued access to work emails and IT systems, staff passes will need to be disabled and secured as well as any keys. All company property must be returned including laptops, phones and uniform. The employer should ensure that appropriate access to the employee’s emails and IT systems is maintained and ensure that emails are redirected to a nominated mailbox.
Sharon said: “An employee departing on bad terms can leave the employer open to potential claims. It’s therefore important to ensure that the process is conducted smoothly and positively. An employee leaving on good terms can benefit the employer in relation to the company’s reputation, future employment and ‘boomerang’ employees who decide to return to the employer further down the line.”
