Firing people is one of the most uncomfortable aspects of leadership, but it’s essential to growth. Know when and why to let someone go—and how to handle the separation.

When something is truly necessary for the growth of our business, feelings often need to take a back seat. This is easier said than done. Letting a team member go, for example, is almost always very difficult.

Thankfully, this psychology is shifting—somewhat—in the workplace, as people on both sides of the management fence gradually become more discerning about finding the right fit for each party. Candidates are now often taking a much closer look at a company’s culture and values before accepting a job, and entrepreneurs who truly know their companies do the same with applicants.

When we understand what the “right fit” really means, we can take a practical look at even the toughest personnel decisions. Here’s what leaders should consider before letting someone go.

Is the right person in the wrong seat, or vice versa?

First, let’s define the “right person in the right seat.” He or she is someone who has the required skills for the position (GWC: Gets it, Wants it, and has the capacity to do it), and who shares the values and purpose of an employer. The latter is what makes for a good cultural fit—and entrepreneurs must understand that a clear definition of what those values and purpose are always comes from the top.

As I highlighted in my previous blogs, when leaders fully understand and outline core values, it’s much easier to hire the best candidate and give them the right role in your company from the outset.

But maybe you’re just now discovering that you didn’t correctly match values and skills with responsibilities. Maybe you did match all three, but things have since changed with the employee and/or the company’s direction. Either way, that employee must be moved to another role—there is often a good fit for an otherwise great performer, for example—or be let go, if that is what’s best for the company.

A common issue is poor performance—the individual just doesn’t GWC (Gets it, Wants it, and has the capacity to do it) the seat and hit the required targets. A tougher situation is when an employee may be a high achiever and a hard worker, but they simply don’t follow the behaviors expected by the core values and/or your shared vision for the company. This individual can quickly become cancer if not addressed quickly or coached to be the right person. The message you send to the rest of the team is that alignment in behaviors and vision is less important than results—which damages your culture in the long run.

Some individuals may even be rock stars in terms of performance, but their demeanor is unsuitable or even toxic. While performance is important, the reality is that these employees may do far more damage to your team than any value they add. It only takes one bad example to corrupt an organization, as researchers Stephen Dimmock and William C. Gerken argue in the Harvard Business Review:

“For managers, it is important to realize that the costs of a problematic employee go beyond the direct effects of that employee’s actions — bad behaviors of one employee spill over into the behaviors of other employees through peer effects. By under-appreciating these spillover effects, a few malignant employees can infect an otherwise healthy corporate culture.”

If you identify someone who is, fundamentally, not a cultural fit, I don’t recommend wasting any time in letting them go.

How can a leader confidently evaluate the right fit and be equally certain about making the decision to part ways?

The EOS® People Analyzer and Accountability Chart

The Entrepreneurial Operating System® provides plenty of free tools for a business to become its best self, and the People Analyzer is one of the simplest ways to check if it’s time to let an employee go, coach them, or shift them within your organization. It lets leaders check company values against individual ones and discover if that team member gets their role at a core level, wants the job, and can prove they’re capable.

The EOS Process™ also emphasizes accountability to discover who’s moving your company forward and who’s holding it back. Check out this short video to see how an accountability chart gets that job done. These two tools put powerful and clear data into the hands of leaders, helping them to decide when it’s time to make a difficult (or maybe easy) termination decision.

Let’s say you have the data. You’re ready to act. But before you do, ask yourself this: is it really necessary to let this person go? Maybe some feedback and coaching could turn that person into exactly the team member you need. A willingness to keep working together rather than simply cutting ties can be an inspiring performance motivator for a lagging employee. But once it’s definitive that the person must be let go …

Consider the approach for terminating an employee

OK, This may be the end of an employee’s time with your company but it’s not the end of their working life. Can you offer them support and help by honestly providing a reference for a future employer? Often, a termination can be a new opportunity or even a relief for both parties. A bad fit is often felt both ways.

Make sure to consider office optics: how situations are not only seen but also perceived in the workplace. It is often best to let individuals go privately and with dignity, and in some cases, afford them the opportunity to say goodbye to others. One employee’s removal can affect the whole team, depending on how it’s done—so leaders should tread carefully.

Clarity is almost always appreciated during a termination. Leaders should be clear without being unduly harsh about the reasons someone is being let go. That kind of honest feedback may sting a little, but the departing employee may appreciate it as very constructive criticism. This clarity also helps with closure, as a confused employee may otherwise try to contest the termination or cause issues after leaving. Some key tips for letting someone go:

  • Thoroughly review your state’s employment laws. Florida is an at-will state, for example, which offers wider discretion for removing employees as long as the termination is clear and its reasons (stated or otherwise) don’t violate local or federal employment and discrimination laws.
  • Document any issues, including poor performance and any attempts you have made to coach the employee. These efforts not only come in handy should there be a legal issue or other dispute down the road, but they also clearly communicate to an employee that there is a problem and you expect them to remedy it—and are affording the person the chance to do so. Plus, when and if it does become time to let that worker go, no one should be completely surprised.
  • Preparing for a rough removal is sometimes an unfortunate reality. In the event of a difficult team member being terminated, it’s wise for leaders to have a second party present. This helps verify events, should stories conflict later. A security presence may also be necessary in the rarest cases if there’s even a hint that the situation could become very hostile or physical.

Load up on more leadership tips

Making tough calls like letting a team member go all comes down to what’s at every entrepreneur’s core: the ability to make smart decisions so our business succeeds. I recommend downloading the EOS guide to being a great boss along with this free eBook that can boost your decision-making abilities. You can also browse my communication archives to learn the best way to get nearly any business message across.

Book a keynote presentation with Cesar for more information on discovering your own brand of leadership—and empowering your business, so you can live life by design.