Offboarding Employees: A 9-Step Process [Free Checklist]
Offboarding ensures a smooth transition when employees leave an organization. Implementing a robust offboarding process helps minimize legal risks, maintain positive relationships with former employees, and protect a business’s reputation.
In this article, we’ll explore employee offboarding, what the process should look like, and provide you with an offboarding checklist to download. Here goes!
Contents
What is offboarding?
Offboarding and onboarding: What’s the difference?
Why is offboarding important?
Offboarding process in 9 steps
Common offboarding mistakes to avoid
Employee offboarding examples
Offboarding software
Employee offboarding checklist [Free download]
FAQ
What is offboarding?
Offboarding is the process during which an employee parts ways with the organization they worked for. It starts from the moment an employee hands in their resignation and ends the day they leave the company, but the effects of it extend long after the employee leaves.
Typically, the departing employee will go through a series of steps, including handing over any work to other team members, returning company property, and completing an exit interview. The aim is to make the transition seamless for everyone involved, tie up loose ends, and ensure the employee leaves on good terms and maintains a positive impression of the company.
In other words, the purpose of offboarding is two-fold. On the one hand, it’s meant to help the organization improve employee experience and to keep the impact of the departure on the business to a minimum. On the other hand, it is used to shape the critical last impressions employees will have of the company – and the image they’ll portray to the outside world.
Here’s an overview of what an offboarding process could look like. We discuss the steps in more detail below.
Onboarding vs offboarding: What’s the difference?
Employee onboarding and offboarding are integral to the employee life cycle and help solidify employee experience.
The onboarding process helps new hires feel welcomed into the company, get set up with any equipment they need, train them on how to do their tasks, connect with their team, and settle into their new role. The aim is to build a solid foundation that sets them, their team, and the wider organization up for long-term success.
The offboarding process is the reverse and helps complete the employee lifecycle in a structured way. Employees must return any company equipment, be logged out of the company network and have their access revoked, hand over responsibilities to other team members, and say goodbye to their colleagues. The aim is to have a stress-free exit.
Why is offboarding important?
Let’s take a look at some of the reasons why employee offboarding matters and deserves your attention.
Former employees are ambassadors
First impressions are important, but so are last impressions.
During the employee journey, there are several key “moments that matter.” For instance, the first day at work, fun team-building events, the first paycheck, a promotion, and the offboarding process.
If employees have fond memories of their final days at a company, they are much more likely to speak highly of their former employer. This will have a positive impact on the company’s employer brand and, by extension, on its appeal to new candidates.
Former employees can become future employees
People leave companies for a myriad of reasons. Some leave because of a lack of career progression, others because of a lack of flexibility, or because they found a better offer elsewhere.
Employees don’t always leave a company because they don’t like the company or its culture. Hence, some of them boomerang back after a stint at another organization. In fact, almost 40% of employees would consider working for their former employer. A positive offboarding experience and those last impressions play a key role in this.
From an organizational perspective, rehiring former employees has its advantages. It’s cost-effective since your “new” hire will be operational and productive faster, and you know that they fit from a company culture point of view.
Former employees are customers too
Just as your candidates, your former employees are often also your customers. This means that while your candidate experience is essential in making sure rejected candidates remain happy customers, your offboarding process is key in ensuring your former employees stay loyal customers.
What better advertising is there for your brand than a former employee who remains a customer even after leaving the company?
Maintaining organizational knowledge
Offboarding is not only about providing employees with great last impressions. It is also about keeping their knowledge within the company after they leave through effective knowledge transfer.
“Knowledge transfer is critical to prevent disruptions and maintain productivity levels, as the departing employee’s expertise and institutional knowledge is transferred to their replacement or remaining team members,” says Matthew Meadows, CEO and co-founder of the performance review software WorkStory.
Security
A proper offboarding process is crucial for security reasons. Research shows that 89% of former employees still have access to at least one application from their former job while already working elsewhere. Half of the former employee accounts remain active for longer than one day after departure. In addition, 76% of IT leaders agree or strongly agree that “employee offboarding is a significant security threat.”
Using your offboarding process to ensure former employees don’t have access to company systems and networks after they leave is a simple way to minimize this threat.
Compliance & regulation
Depending on the company’s industry and location, your organization may need to meet certain guidelines and regulations around access and offboarding. “Compliance is an important aspect of offboarding. There are several state laws you should be aware of before an employee’s last day, like what time off is paid out and the timing of the final paycheck,” notes Allyns Melendez, Founder of HR Transformed.
Ensuring compliance with these rules and preventing potential legal issues is much easier if you have a repeatable process – your offboarding process, in this case – in place.
Offboarding process in 9 steps
What does an ideal offboarding process look like? The exact details will depend on the type of organization and role, but there are some best practices that you can follow to ensure that everything goes smoothly.
1. Thank the leaving employee
Thank the employee for all their work and efforts during their time with you at the organization, and make it clear that they will be missed. If they are taking the next step in their career or their life, don’t forget to congratulate them.
2. Communicate about the departure
While it can be tempting to hold off on communicating about an employee’s departure until you’ve got all the details, it is wiser to share this information sooner rather than later to build trust and transparency and reduce company gossip. Communicate with the outgoing employee on how and when this news will be shared.
Managers should inform their team, department, and HR about an employee’s departure as soon as possible.
Communication throughout the entire offboarding process is key to success. “Clear communication ensures that everyone is on the same page and understands what to expect during the offboarding process,” suggests Sanya Nagpal, Head of Human Resources at an employee experience platform Leena.AI.
3. Ensure a knowledge transfer
Whether you hire a successor or not, it’s important to keep the leaving employee’s knowledge inside your company.
Make sure you have:
- A clear overview of the daily tasks they perform
- An understanding of tasks have priority
- Access rights to all the systems and files they use
- A list of people they work with, both inside and outside the organization
It’s always good to ask people to create a handover document or video with useful tips for whoever will take over their role. If you know who this will be, the handover can start immediately.
In addition, if there are tasks that can be automated or fitted into standard operating procedures, the departing employee is the best one to do so. This will save you time and money.
An added bonus of a positive offboarding process is that if you find yourself missing certain knowledge after their departure, you’ll be able to ask the employee to help you out, which they’ll be happy to do.
4. Recover company assets
According to a survey by Oomnitza, 27% of organizations reported losses of more than 10% of their technology assets due to incomplete offboarding.
It’s important to ask the leaving employee to hand in company equipment on their last day: company badges or lanyards, credit cards, uniforms, phones, laptops, or a company car.
“I discovered that one element of the employment life cycle that is being neglected more than any other is offboarding. I still have uniforms that no one reclaimed and name badges that should have been collected,” shares Nora Burns, who worked as a frontline employee for Fortune 500 organizations as part of her Undercover Project.
It’s a good idea to create a checklist of all assets to ensure that you don’t miss anything.
5. Revoke systems access
A survey by Beyond Identity found that nearly 1 in 4 employees said they still had access to accounts from past jobs.
Remember to revoke the employee’s access to all systems, including the internal company network and any other accounts and software to which they have access. For example, CRM systems, the company’s social media accounts, content databases, and access to sales dashboards. This is an important step to prevent any security risks.
6. Hold an exit interview
When done properly, an exit interview can provide you with a wealth of information, including insight into your organization’s strengths and weaknesses that you would not usually receive and how to improve the latter.
An exit interview will typically be a confidential meeting between someone from the HR team and the exiting employee. Take all feedback seriously, and remember that the exit interview will play a big part in how the leaving employee will remember you as an employer.
Here are some potential exit interview questions to ask during the meeting:
- What made you decide to leave?
- What would you improve about working here?
- What could we have done differently to make you stay?
- How was your relationship with your manager?
- What qualities should we look for in your replacement?
- What are we not doing that we should be doing to create a better organizational culture?
- Would you recommend our company to job seekers in your network?
7. Update your organizational charts
Once an employee has left the company, update your organizational charts and directories.
If there is a successor, include their details; if there isn’t, include the details of whoever is taking over. The same applies to brochures and the company website and can prevent a lot of (internal) confusion.
8. Arrange final payments and benefits
Just as some companies forget to revoke a leaving employee’s systems access, they sometimes forget to take them off their payroll.
Even though most payroll systems have this functionality built in, double-check that the final payment process is carried out by your Payroll or Finance department. To facilitate this, give them all the details they need, including the employee’s end date, notice period, possible holidays that need to be paid out, and anything else of importance.
9. Stay in touch
There are various ways to stay in touch with former employees, such as via a talent pool or an alumni group. Both options allow you to send former employees the latest company news (and vacancies) so that they remain in the loop if they want to be. Dedicated corporate alumni software providers like Aluminati and EnterpriseAlumni can be a great option.
But staying in touch has other benefits, too. As we briefly mentioned, it can be useful in case you’ve lost some knowledge only the leaving employee had or if their successor needs help with a specific task.
From the former employee’s perspective staying in touch has advantages too, for example, when they need a reference or a letter of recommendation, or if one day they see a vacancy that piques their interest and potentially want to return.
Common offboarding mistakes to avoid
What are some of the common offboarding mistakes that organizations make? Here are the key things to avoid repeating in your offboarding journey:
- Skipping the exit interview – When employees know they are leaving the organization, they are much more likely to share feedback that your existing employees may be too afraid to share. This is valuable and can help you improve what’s not working to reduce turnover.
- Not having a knowledge transfer process in place – Without an effective knowledge transfer process, there is a risk of losing valuable organizational knowledge that will take new employees or other team members months or maybe years to re-acquire.
- Neglecting paperwork – Failing to complete the necessary paperwork can result in compliance issues, subsequent fines, and loss of money (e.g., extra payments made to departing employees and difficulty getting the money back).
- Not using an offboarding checklist – Allyns Melendez from HR Transformed emphasizes the importance of having an offboarding checklist. “An offboarding can be a sensitive time. A company should put care into their offboarding checklist to ensure all exiting employees are treated equally, and all items are handled properly so that there is consistency in the process,” remarks Melendez.
- Failing to create a remote offboarding process – With more and more employees working remotely or on a hybrid basis, it’s important to consider your plan for remote offboarding. For example, how will you collect equipment from remote employees? How will you ensure knowledge transfer in a remote setting?
- Lacking empathy – It’s important to remember that employees don’t always leave voluntarily, and even when they do, there may be other sensitive reasons that have led to their decision. Treat all exiting employees with the empathy and respect they deserve.
Employee offboarding examples
Olo offboarding with Asana
Olo – a rapidly growing digital ordering and delivery service for restaurants across the US – uses Asana to design a complete onboarding and offboarding experience for all employees.
Even though many employees work remotely, the offboarding process is seamless. The security and protection of the company are upheld, and Olo’s People & Culture team works through a checklist to wrap up any loose threads, including an exit interview, final payroll, removal of software access, and more. The employee’s exit remains confidential in the system until other employees are informed of their departure.
This ensures a positive, professional experience for the exiting employee right up to the day they leave.
Parker Drilling offboarding with ServiceNow
Parker Drilling used to have a paper-based offboarding service that required much manual admin work. Since switching to a fully automated service called ServiceNow, they can proactively monitor their offboarding procedures. Warnings and alerts help them stay on track, reduce the time it takes to complete, and deliver an efficient and painless offboarding process for everyone involved.
Offboarding time has been reduced by over three days. Systems access for those departing is now one day and seven hours, down from four days and four hours. Failure rates have been improved by 99.6%. This has led to an estimated 275% improvement in productivity for HR and $200,000 in savings through automation.
Fortune 500 company in the medical innovations field
The company needed to create a better employee offboarding process so that employees had a better experience and no delays.
Aufait Technologies designed an automated software solution to create a more positive and seamless offboarding process. With this, the document workflow is seamless, company data is now safeguarded, employees are kept in the loop the entire time, and the door is left open in case they decide to boomerang.
“Make sure that you learn something from the offboarding process. Offboarding is always an opportunity to gather information.
If the separation is involuntary, consider the circumstances that led to it in order to prevent it from happening in the future. Was it a result of a mishire? Could management have corrected performance earlier and coached the employee back on track? Did the needs of the business change in a way we can predict better in the future?
If the separation is voluntary, conduct an exit interview and ask the employee why they started looking for a new job. This will give you valuable insight to the cause of attrition within the organization and will help you as you work to retain employees for longer.”
Kate Conroy, Senior Consultant at Red Clover HR
Offboarding software
Offboarding software can help you create a well-structured and effective offboarding process. Many companies use their HRIS for offboarding, but below, you’ll find some examples of software with dedicated offboarding modules that allow you to customize and automate offboarding.
HR Cloud
HR Cloud lets companies create the ultimate offboarding experience for departing employees with a company-branded exit portal. Their solution automates specific offboarding procedures and automatically sends required documents like final pay summaries while ensuring a memorable experience for the employee.
HROnboard
Although HROnboard provides onboarding software, they also offer an offboarding solution. This helps you structure your offboarding process and tick all the required boxes: the necessary documents, final pay information, exit surveys, and even a team farewell.
BambooHR
With BambooHR, you can ensure compliant offboarding by working through checklists and leveraging automation to focus on people rather than processes. The software proactively answers common questions employees might have during the exit process. It makes it as simple and clear as possible, which helps your employees feel appreciated and protects your employer brand.
Talmundo
Talmundo oversees the exiting employee, the manager involved, and the HR processes. Space is created to ensure employees are given a meaningful goodbye, human error is minimized with improved and automated HR processes, and managers are guided to protect team integrity and ensure a smooth handover of work and knowledge.
Trello
Trello isn’t an official offboarding tool. However, if you don’t have an extensive budget, this is a good example of a free tool you can use to structure your employee offboarding.
The platform is primarily known as a collaborative project management application, but you can also use it to create a template and checklist to help you offboard employees.
Employee offboarding checklist
We’ve created a helpful employee offboarding checklist template that you can use in your organization. You can download it in a Word or Excel format for free below. It includes simple steps for HR to ensure a seamless and positive experience for everyone involved. You can use this as a starting point and adapt it to suit your needs.
On a final note
A well-structured offboarding process can make things stress-and hassle-free for everyone involved. Effective offboarding creates a positive experience for your departing employees, protects your data and IP security, saves you money, and boosts your employer brand.
If you still need to create an offboarding process for your organization, there’s no better time to start.
FAQ
Employee offboarding covers the entire process from when an employee hands in their resignation (or is involuntarily terminated) to the day they leave the organization and beyond.
Offboarding is the structured process of managing the transition when an employee leaves an organization. It encompasses a variety of tasks and steps, including communicating the employee’s departure, retrieving company assets, revoking systems access, and holding an exit interview.
The specifics of the offboarding process can vary based on the organization, the role of the departing employee, and the reason for departure. Proper offboarding ensures a smooth transition for both the organization and the departing employee.
The length of the offboarding process will vary depending on how much notice an employee has to give before they can leave. The offboarding process could be completed in a day if no notice is required. Other times, especially for very senior roles, it will take a few months. Automating parts of employee offboarding helps speed up and simplify the process.
The onboarding process focuses on the entry of your new hires into your organization, helps them feel welcome, and equips them with any tools and training they need to succeed at work. The offboarding process covers the journey from when an employee resigns (or is terminated) and exits the organization.
Offboarding is important because former employees are still ambassadors (and potential customers) of your organization, which affects your employer brand. There is also the chance that employees will boomerang back to your company in the future as long as things end on a positive note. Plus, the offboarding experience maintains the security of sensitive data and ensures the organization remains compliant.
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