Let’s imagine something: you have the BEST business team. 

All your staff members work together cohesively to bring you success, and you’ve reached unimaginable heights with them at the helm. You can only go up from here!

But then, your most promising and talented employee decides to leave. 

While it’s heartbreaking, it’s best to let them go and ensure that both parties go their separate ways on a positive note.

That’s the purpose of offboarding. 

Offboarding is the yin to onboarding’s yang and ensures your departing employees go through a smooth transition while avoiding legal risks and protecting your reputation.

But why is offboarding such a vital part of the employee lifecycle?

Let’s dive deeper into what offboarding is and uncover the best practices for optimizing it. 

What Is Offboarding?

While a good onboarding process helps a new hire find their place in the company’s culture and reduces the stress of starting a new job, an employee’s last day is equally disorienting.

Many companies overlook the importance of an exit process, but it’s your final chance to leave a lasting impression that’ll boost morale and increase employee retention rates.  

In short, offboarding: 

• Helps your company grow
• Ties loose ends 
• Protects your business from legal issues
• Provides valuable insight into redesigning your structure

Used for an employee’s voluntary or involuntary departure, offboarding minimizes organizational disruption and helps you gain valuable feedback from a former employee. 

That’s a lot to process, but with so many separations occurring in 2023 (the rate being 3.8%), ensuring your employees leave on good terms is even more necessary. 

So, let’s take a look at why employee offboarding matters. 

Why Does Offboarding Matter?

Employee offboarding is more than throwing a goodbye party and patting the employee on the back for their hard work. 

When done well, offboarding has the power to: 

Boost company reputation

A high-quality offboarding process provides an opportunity to strengthen your connection with your former co-workers and ensure they become brand ambassadors that’ll continue to interact with your company. 

Moreover, since attracting and retaining employees is one of the biggest HR challenges, an effective offboarding process facilitates better reviews and serves as a way to bring candidates into your company through employee referrals. 

With a good brand reputation, you can maintain healthy talent in your company and create positive employee experiences throughout the employee lifecycle. 

Ensure data security

According to this report, 3 out of 4 companies don’t know how much sensitive information departing employees take to other companies, either deliberately or accidentally. 

That’s why an offboarding process is more than just worrying about the employee’s severance or benefits package. 

It’s also about data security—and ensuring your company property is safe from harm.

Offboarding helps revoke all employee access to online company accounts so ex-employees won’t meddle with them after their departure.

This way, you ensure your company is compliant with jurisdiction rules while avoiding data leakage, which is necessary now more than ever with so many people working from home.

Strengthen brand image and company culture

When a beloved employee quits, other team members can be disheartened by the news. 

As a result, it might spread negativity and increase employee turnover, especially when a company badly handles the employee’s departure and keeps people out of the loop. 

Through a comprehensive offboarding process, you treat your employees respectfully and open the door for future communication. 

In addition, how a company deals with departing employees sends a positive message to clients, job seekers, and current team members, increasing employee engagement. 

For instance, employees who’ve experienced a positive exit are almost 3x more likely to recommend a brand to friends and acquaintances than those who’ve had a negative experience. 

Create boomerang employees and brand ambassadors

Your relationship with former employees can continue after their departure. 

While an employee’s career might sometimes lead in a different direction from where your business is going, keeping open communication with them might aid your hiring initiatives. 

What does that mean?

It indicates that you leave the door open for reconnection if a great employee wants to return in the future. 

So, instead of training new employees, you rehire someone already familiar with your organization. 

Many human resources professionals call these rehires “boomerang employees,” and it’s a common practice nowadays as the competition is getting tighter. 

In fact, according to a study, 1 in 5 employees have boomeranged back to their old jobs, so it’s crucial to begin your digital recruitment efforts ASAP. 

Author’s Tip: HR tech can aid your company in recruiting suitable candidates, so look for human resources tools that’ll help your business soar to new horizons. 

Employee Offboarding Best Practices

Through a good employee exit strategy, you ensure you gracefully handle what can otherwise be an uncomfortable moment. 

Discover the best practices that your HR department can take to boost the offboarding experience.  

Conduct an exit interview

The first thing you should do as part of your offboarding checklist is hold an exit interview.

An exit interview is an excellent opportunity to gauge why an employee is leaving and their overall impression of the company, while receiving suggestions on improving and growing your business. 

Here are some exit interview questions you can ask: 

• What made you decide to leave?
• What’s your opinion about management?
• Do you have any suggestions for improvement?
• How do you feel about your development in your company?
• How likely are you to recommend this company?

It’s essential to have a member of the HR team conduct the interview because it allows the interviewee to offer candid feedback. 

Author’s Tip: The person performing the interview should remain calm, no matter the feedback, and avoid attacking or criticizing the employee’s opinions. 

Let your team know

An important step of employee offboarding is speaking with your team. 

Breaking the news might be somewhat awkward, but the sooner you do it, the better. 

Gossip only creates a toxic work environment by allowing current employees to fill in the blanks themselves; no matter the reason, it’s better to be honest with your team about why someone is leaving. 

That way, you admit your mistakes and can take steps to fix them. 

So, to avoid miscommunication, you can publicly congratulate and thank your employees for their time and service—and monitor the team’s reaction and needs. 

Author’s Tip: Show an employee how much you appreciate their efforts in turbulent times with a thoughtful gift. 

Take care of the paperwork

All good employee offboarding processes have a “boring” part.

In this case, it’s taking care of paperwork and ensuring you don’t break any compliance rules.

What you need to do is: 

• Review contracts and non-disclosure agreements (NDAs): Run a final review of the contract by the employee to ensure everything is clear. 
• Prepare compensation, tax, and benefits documents: Ask your accounting team to evaluate an employee’s final paycheck so that everything is in order.  

Secure company assets

As stated before, you should leave no stone unturned when it comes to security risks. 

A good offboarding process guarantees your employees are logged out of all devices so they don’t take any sensitive data with them to their next workplace. 

Moreover, you ensure they don’t accidentally share or distribute company equipment, such as laptops, and that you’ll receive equipment back from your remote employees. 

Leave a good impression

Saying goodbye to an employee may be tough. 

But that doesn’t mean you should just go through the steps mentioned above; offer them a cupcake, and call it a day.

In the end, you’re managing a relationship with a human.

The final step of the process is making a good lasting impression by treating the employee with the respect they deserve. 

Their contributions helped your company, and your farewell should reflect your gratitude.

If your company culture allows it, you should consider the following: 

• Write a heartwarming thank-you letter signed by the team
• Throw a meaningful farewell party
• Give them a personalized gift

Now Over to You

The bottom line is you need offboarding just as badly as you need employee onboarding.

A good offboarding process not only ensures the departing employees leave on good terms but it also maintains brand loyalty and fosters employee engagement. 

However, while you shouldn’t forget about this vital step in your employee lifecycle, there are other terms that might need exploring. 

Visit our glossary to find out more about the wonders of human resources.