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The Complete Employee Offboarding Checklist [+ Free Download]

Simplify your employee's exit process with these easy-to-follow offboarding steps.

Anna Coucke

by Anna Coucke - February 24th, 2023

When we consider the employee lifecycle, we tend to focus on onboarding and engagement while overlooking a crucial part – the offboarding or employee exit process. Overall, companies are much more likely to focus on onboarding, with 58% having a formal onboarding process but only 29% having an offboarding process established.

Download the Guide To Creating a Positive Offboarding Experience

Unlike onboarding, where candidates and HR share the excitement of a new journey, offboarding doesn't always happen in good spirits. Unexpected terminations can make emotions run high, but every offboarding experience can potentially leave a good impression, and it starts with humanizing the process.

The last impression can be just as important as the first impression for an employee – they may return as a boomerang employee or become an active part of your organization's alumni who continue to promote your employer brand. Also, your current employees will notice how you treat their former colleague (and potentially, their friend) during the employee exit process, which can impact their opinion of their employer and future in the organization. 

What is Employee Offboarding?

Employee offboarding is the exit process that helps both organizations and employees understand the reasoning behind their decision to leave the company. Whether the employee decides to leave themselves or the organization makes the decision to let them go, an effective offboarding process can reduce the chance of misunderstandings between both parties. It can also be an excellent opportunity to receive the departing employee’s feedback about the organization and answer any questions they might have before they move on to their next professional step.

a free employee offboarding checklist for hr teams

For human resources, the interpersonal aspects of the employee offboarding process are crucial—even if the employee is leaving on good terms, terminations can be sensitive. You’ll want to ensure you consistently complete all of the necessary exit process documents and remain compliant. To achieve this, you can utilize a solution like GoCo to streamline your outdated, manual processes for offboarding paperwork and make an often difficult task as easy as possible. Just like the process of onboarding new hires, by dealing with the paperwork aspects of offboarding first, you can focus on the human element to ensure a smooth transition for the employee and organization.

Your goal should be to treat every employee as well as you did when they first started. Regardless of how they come about, terminations can be emotional for the employee. It’s crucial to treat terminations with compassion and empathy – recognize you’re dealing with a human being who is getting separated from the income and benefits needed to support their family and themselves. People deserve to have the most positive experience possible, even if they are being fired.

We’ve created an offboarding checklist to serve as a guide for small businesses. Use this checklist to ensure the offboarding process goes smoothly, you use your time efficiently, and your company’s relationship with former employees remains positive. To get the full picture, check out our Onboarding Checklist and New Hire Paperwork Checklist as well!

Why is Offboarding Important?

Employee offboarding is an integral part of the overall employee experience and can significantly impact both the departing employee and the company. A well-planned and executed offboarding process can ensure a smooth transition for the departing employee and help to maintain a positive relationship even after they have left the company. This can be important for maintaining a positive reputation and for potentially rehiring the employee in the future. 

A thoughtful offboarding experience can also help ensure a smooth transition for the company by helping transfer responsibilities and information to a successor and providing opportunities for the company to learn and improve. Overall, a positive offboarding experience can benefit both the employee and the company.

Offboarding Is Part of the Total Employee Experience

In a typical employee journey, employees go through three distinct phases: pre-employment (search, application, interview, and job offer), employment (onboarding, contribution, development, and growth), and post-employment (separation and searching for a new position). In most cases, companies give the most weight to the first two phases and put little focus (if any) on the exit. 

The reality is that offboarding is still part of the overall employee experience—just as much as health and wellness, growth opportunities, and trust in leadership. These things aren’t just nice to have – they’re essential in creating a strong employee experience. Companies shouldn’t send their employees off to their next adventure without bringing that positive employee experience full circle.

What to Include In Your Employee Offboarding Checklist

1. Basic Employee Info

The first step in offboarding is collecting basic data like the employee's name, job title, and last day at work. Depending on how thorough you want to be, you can also add the reason for their termination, their organizational department, contact information, the HR liaison’s name, and the final date of checklist completion.

2. An Official Letter of Resignation

If an employee is resigning on their terms, they must provide a letter of resignation. This can be a written letter or an email from the departing employee, but keep a copy on file.

3. Acknowledgement From Human Resources

As soon as a resignation letter is received, the first order of business should be to inform the HR department. If you’ve received verbal confirmation through the employee, tell them to draft an official letter and submit it to the HR department.

This helps provide a notice (typically 2 to 4 weeks) so that every party involved with the employee can stay informed. This also includes providing notice to banks, credit card providers, health insurance providers, life insurance providers, and other relevant parties.

After that, you will need to gather all documentation, including receipts, termination letters, confidentiality agreements, and performance reviews in the personnel file.

4. Completed Termination Letter

A termination letter will include information such as the employee’s name, position, and manager, along with information about their termination, such as the reason for dismissal, the date of their last day of employment, and severance pay and benefits they will receive. This must be signed and dated by the employee, their manager, the HR administrator in charge of the termination, and any other stakeholders.

5. Employee Copies of Relevant Policies

This serves as a reminder to the departing employee about contracts signed during their employment, including inventions assignment agreements, non-disclosure agreements or non-compete agreements. Through an HRIS platform like GoCo, you can upload these documents to the employee’s account so they can access them at any time. You will also be able to track the dates the employee signed or acknowledged documents for reporting purposes.

6. Internal Communications Plan

Terminations, whether voluntary or involuntary, are sensitive. Determine a communication plan for delivering the news to their team, department, or organization. This will likely be through an offboarding email that thanks your employee for their contributions before the employee leaves.

 Consider employees significantly impacted by their colleague’s departure and take the time to personally deliver the news to them. You’ll need to use your discretion here based on the employee’s contributions and attitude toward the organization.

7. External Communications Plan

An external communications plan is essential if the employee is in a client-facing or high-profile role. You’ll need to instill confidence in your clients to ensure the offboarding period does not negatively impact them. Remove the employee from the company directory, website, or other external communications.

8. Date of Scheduled Exit Interview

Exit interviews are your chance to make the employee feel like they made a difference and provide insights into your company’s work environment and its processes. It also allows you to discuss their final paycheck, vacation time and sick time, the company property retrieval system, trade secrets, and other company information. 

During the termination meeting, let the terminated employee talk about their work experience and feelings about the company, its business processes, and other employees.

Considering that the employee will be applying for other jobs, you should have them sign an agreement that will let you verify their employment at your company. It can also be used as a reference by the employee.

Remember that you will need to gather and verify all employee information, such as contact information and mailing address, since you have to fill out W2 tax forms correctly. 

9. Transition Plan

Determine a plan for coverage during the offboarding process. Who will cover the terminated employee’s work until you can hire and train someone new? You’ll need to evaluate the urgent and important work. To encourage the team to take on additional work during this period, highlight the opportunity for someone to show initiative and take on more responsibility.

10. Vacant Position Re-Evaluation

Before you immediately start to recruit for backfill, take a moment to reflect with the appropriate manager. Do you need to backfill this role exactly as it was? Most small to mid-size businesses are continuously evolving, and this may be a good opportunity to reevaluate what your organization needs. As part of the offboarding process, try to get the employee’s opinion on what may be needed to handle their old responsibilities.

11. Post-Termination Healthcare and Retirement Program Info

You’ll need to terminate their health and welfare benefits according to the terms in the plan documents. However, you may have to offer them an extension of their healthcare coverage through the Consolidated Omnibus Budget Reconciliation Act (COBRA)

Your organization will stop contributing to spending accounts and retirement programs, but the employee may leave the funds in the plan if they choose to. Provide them with the necessary login information and documentation of their options so they can make informed decisions.

12. Updated Personal Information for Future Documents

They may not be your employee anymore, but you are still responsible for providing them with tax documents at the end of the tax year. Make sure to check that you have the most up-to-date personal information to avoid issues with tax and healthcare documents.

13. Arrangements for Their Final Paycheck

You must include any clawbacks (e.g., borrowed vacation, courses the company paid for with an agreement) and payouts (e.g., banked vacation). If you provide the employee with severance pay, break down the amount of severance received along with the terms. 

14. Checklist Of Company-Owned Equipment to Be Returned

This includes their laptop, cellphone, ID/Access card, credit cards, parking pass, keys, etc. Don’t forget computer accessories like special order keyboards, monitors, or additional computer chargers. 

15. Plan to Remove Access to Any Organizational Systems

Studies have found that a whopping 89% of former employees can access sensitive applications and documents after their departure. Be sure to disable any company emails, remove access to any systems the employee may have used to do their job, such as Sharepoint or Google Drive, and change the passwords for any team accounts. If possible, route emails to their manager or set up an automated email response to notify the sender that the employee is no longer with the company.

Using this employee offboarding checklist will create a streamlined and consistent process for every employee. The last impression is an often overlooked opportunity to create brand ambassadors for your organization, but with GoCo’s software solution, you’ll be able to automate the paperwork and compliance elements of the offboarding process. This ensures you don't waste time on administrative tasks like printing documents and chasing signatures. Instead, you’ll be able to focus on creating a positive last experience and a smooth transition.

How GoCo Makes Parting Ways with Employees a Positive Experience for All

Are you tired of the hassle and paperwork that comes with employee offboarding? GoCo's Employee Management Software can help! With GoCo, you can automate the offboarding process and focus on creating a positive last experience for your departing team members. Our solution streamlines paperwork and compliance elements, making the task way easier than you ever thought possible.

Terminating employees and contractors has never been simpler. With just a few clicks, you can remove them from payroll, disenroll them from benefits, and issue COBRA and State Continuation notices. Plus, GoCo gives you clear visibility into each termination status so you can easily track everything. With our filters and labels, you can locate relevant information super fast.

Are you tired of the hassle and paperwork that comes with employee offboarding? GoCo's Employee Management Software can help! With GoCo, you can automate the offboarding process and focus on creating a positive last experience for your departing team members. Our solution streamlines paperwork and compliance elements, making the task way easier than you ever thought possible.

Offboarding employees and contractors has never been more straightforward. With just a few clicks, you can remove them from payroll, disenroll them from benefits, and issue COBRA and State Continuation notices. Plus, GoCo gives you clear visibility into each termination status so you can easily track everything. With our filters and labels, you can locate relevant information super fast.

Why deal with manual paperwork and administrative burdens when you can utilize GoCo's Employee Management Software to simplify the entire offboarding process? Create a consistent and streamlined process for every employee and focus on delivering positive last impressions and smooth transitions instead. Come check out GoCo today to learn how our software helps with every part of the employee experience, including compliance and benefits administration!

Employee Offboarding FAQs

Conducting an employee exit interview is an important part of the offboarding process, as it allows the departing employee to share their experiences and feedback with the company. When conducting an effective exit interview, planning and preparing a list of questions to ask the employee is essential. Some questions that may be useful to include are:

  • What were some of the highlights of your time with the company?
  • What were some of the challenges you faced during your time with us?
  • What could the company have done differently to improve your experience?
  • Do you have any suggestions for improving our processes or policies?
  • Are there any concerns or issues you want to raise before leaving?

It’s important to create a comfortable and open environment for the exit interview, where employees feel free to share their thoughts and feedback honestly. This may involve scheduling the interview at a convenient time for the employee and providing a private and confidential space for the conversation. It’s also vital to listen carefully to the employee’s feedback and take notes to ensure that their comments are properly documented and can be used to improve the company.

When an employee leaves the company, it’s crucial that their responsibilities and duties are transferred to a successor smoothly and efficiently. To do this, planning and identifying a suitable successor well before the employee’s departure is important. This may involve working with the departing employee to identify their key responsibilities and duties and determining which tasks can transfer to the successor and which may need to be reassigned to other team members, even temporarily.

Once identified, a successor must be given the necessary training and support to take on the departing employee’s responsibilities. This may involve providing access to relevant information and resources and setting up regular check-ins and meetings with the departing employee before their last day to ensure a smooth transition.

In addition to transferring responsibilities and duties, it’s also vital that the departing employee’s access to company systems and information is terminated promptly and securely. This may involve disabling their access to company accounts and networks and transferring relevant files and documents to the successor or other team members. Overall, a well-planned and executed transfer of responsibilities and duties can help ensure a smooth transition for both the departing employee and the company.

Collecting and sharing feedback from departing employees is another essential part of the offboarding process, as it provides valuable insights and information that can be used to improve company practices. To communicate this feedback to your company's leadership, document the employee's comments and suggestions during the exit interview or other offboarding conversations and share this information with relevant teams and managers. This may involve summarizing the feedback in a report or presentation and presenting it to the appropriate teams or departments.

It’s also important to act on the feedback quickly and effectively, which involves creating action plans to address any concerns or issues raised by the employee and following up with the appropriate teams to ensure that the feedback is implemented.

In some cases, sharing the feedback with the entire company may also be helpful to improve transparency and demonstrate that the company is committed to listening and responding to employee feedback. Effective communication of this feedback can help to improve the company and create a positive work environment.

Final Thoughts

Although the offboarding process is often overlooked, it is an integral part of the employee journey and must be treated as such. 

By taking a human approach to a sometimes uncomfortable process, you can create a thoughtful and smooth experience for the departing employee so that their final memories of their time with your company are positive.

Streamline your employee management process, including offboarding, by utilizing GoCo’s Employee Management Software to ditch the arduous tasks of manually collecting and filling out paperwork, signatures, and spreadsheets, so you can focus on your employees’ experience. Take a tour today! 

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