Divorces and Terminations: Lessons to Be Learned

by Michael Haberman on July 11, 2008 · 0 comments


I was reading an article on divorce (just reading, I am not getting divorced- whew!) and I was amazed how similiar much of this was to terminating an employee. The article was about things you should not do to disrail your divorce. These included:
  1. Not paying attention to taxes.
  2. Being too generous to win back your spouse.
  3. Making agreements outside the settlement papers.
  4. Having sex with your ex.
  5. Using your child as your messenger.
  6. Not keeping a journal.
  7. Not being prepared.

(Note: There were some others but they did not fit as well. Hey I said it reminded me, not that there was a 1-to-1 relationship.)

So how do these reflect the termination process you ask?

  1. Not paying attention to taxes. Believe it or not there may be actual tax consquences to terminating an employee depending on the level of the employee. Severence agreements that are paid out over time may be considered deferred income and be regulated in public companies by Sarbannes -Oxley. So be aware of these consequences for both you and the employee.
  2. Being too generous to win back your spouse. Sometimes when we have a valued employee submit a resignation (divorce) we go overboard and try to throw money at the employee, or offer promotions, or title changes or benefits. Whatever will keep the employee from leaving. The problem with this is it may not be the solution to the problem that caused the employee to leave in the first place. But you have gotten so generous the employee would be a fool not take the money. You may then still have a delayed problem. So investigate why the employee is truly leaving before you throw money at the problem.
  3. Making agreements outside the settlement papers. Once you have written a termination don’t agree to anything else unless it is in writing.
  4. Having sex with your ex. Once an employee is gone, it is best to let them stay gone. Don’t contract with them to do work. Don’t hire them as consultants or contractors. The IRS doesn’t really like that and you will end up with potential tax ramifications and penalites.
  5. Using your child as a messenger. Sometimes you don’t want ex-employees contacting your employees. In some cases they may be barred by a non-compete from doing that. You certainly don’t want to use your employees to pass messages back and forth to the ex. Don’t put your current employees in the position of go-between.
  6. Not keeping a journal. The mantra of HR is documentation, documentation, documentation. That applies double for terminations. What leads to them, what occurs during and what follows after.
  7. Not being prepared. Before you ever sit down with an employee to terminate them have all your “ducks in a row.” Know when, why, how, what was said, what needs to be said. Investigate. Nothing is more embarassing than sitting down in a termination supposedly prepared only to find out that it is not the way things went. Be aware of potential biases of supervisors and managers. Be aware of previous history. This is especially important when HR is remote from the worksite and there is no day-t0-day knowledge.

Most divorces go pretty well. But some are very, very messy. (Ask Christie Brinkley’s husband.) Terminations are the same way. Most go pretty well, but some are very messy. And most messy ones occur because of mistakes that are made.

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