Step-by-step Guide to Successful Employee Exit Management

employee exit management

If you are onboarding new employees, then most certainly, you are losing some of your old employees. But, just because your employee is leaving, doesn’t mean they lose importance. They can provide invaluable insight during the employee exit management interview.


These days, most organisations are investing more in employee recruitment and onboarding, while employee exit management often takes the backseat. 


However, with little effort and attention towards the offboarding process, you can risk exposing yourself to unnecessary legal and security issues. Therefore, you must go through multiple steps before an employee leaves your company. Additionally, they often give valuable feedback that can help you improve company operations. 


This article shares the importance and purpose of an employee exit management process and the steps you must fulfil before waving “bye” to an employee. 

What is Employee Exit Management?

Most of us know the onboarding process that happens when an employee joins an organisation, but little do we focus on the offboarding or exit process. Employee exit management refers to an organisation’s step-by-step approach to employee termination. 


It applies to employees resigning voluntarily or being terminated by the company through dismissal or layoff. However, the process for each case differs, but neglecting them can result in ugly backlashes, e.g., regulatory violations, data breaches, etc. 

What is the Importance of Employee Exit Management?

You must know that time is money in the business world, which means every second you invest must bring in money. But why should you invest in employee exit management? 


There’s a reason why experts advise businesses to focus on exit processes similarly to onboarding employees. We have listed the importance of implementing exit management in HR.

Improve Staff Retention

Research says roughly a third of employees resign within the first six months. It means staff retention in companies is a critical task for recruiters. When investing in multiple tools to retain employees, invest in exit interviews as well. 


You can acquire constructive feedback from them that helps you learn the company’s hidden strengths and shortcomings. These allow you to find solutions to high employee turnover in your company.

Improve work Culture and Performance

Employees leave honest feedback on your business when they depart your company. It helps you find areas of improvement and ensure a healthy workplace for other workers. 


Furthermore, you can also see a different perspective of your business from an employee’s viewpoint. Thus, you keep their complaints in mind while hiring new candidates for the role and avoid repeating your mistakes for the second time. 

Build a Positive Brand Image

You build a positive brand image as employees feel satisfied communicating their issues with you before leaving the company. They feel valued as you listen to their opinions and suggestions. These employees may go further in referring you to others in their network. 

Allows You to Tackle Issues

Your departing employee may give an overview of any ongoing problem in your business. For example, harassment, bullying, etc. These issues may remain hidden from HR and the management, leading to more workers leaving work. 


Therefore, employee exit management must include proper communication to understand and solve similar problems immediately. 

What is the Process of Employee Exit Management? 

When an employee leaves your company, either resigns, retires, or gets terminated, they must undergo an employee exit management process. However, research says almost 99% of companies are conducting exit interviews wrong.


Therefore, we have listed a few steps for you to follow during an employee’s exit.

Addressing the Resignation, Retirement, or Termination

Once your employee is terminated, retires, or resigns from your company, you must conduct the offboarding process. This means you must send out a formal letter in case of termination or retirement and sign the necessary documents. 


Similarly, if your employee resigns, they will send you a formal letter. In any of these cases, you must actively handle the sensitive circumstances and empathetically reach a thoughtful solution. 

Automating the Offboarding Process

Your company needs to digitise the process of employee offboarding, which reduces your overall stress. Usually, the offboarding process is tedious and lengthy and involves substantial paperwork and documentation. 


With an employee exit management system handy, you can avoid complexities and error-prone manual tasks. Therefore, it fastens the entire process and yields a healthy exit of employees on a good note.

Prepare Offboarding Checklist

You must prepare an offboarding checklist by considering your employee exit policy and procedure. It comprises a detailed list of equipment, assets, and login access of the employee provided during their onboarding, along with their name, job role, department, etc. 


Your departing employee may know or have access to confidential data and documents. Before leaving your company, these must be handed over to the management, and a checklist helps you finish the process. 

Ensure Transferring Knowledge 

When employees leave, all their documents and responsibilities must be transferred to the one replacing them. Using an employee exit management system can store all this transferred knowledge, and new hires can access it anytime and anywhere. Additionally, it reduces the risk of data theft and non-transfer of data before employee departure.

Deactivating Login Access and Recovering Equipment

Once your departing employee completes transferring responsibilities and knowledge, you must withdraw their access from all official logins. Additionally, it would help if you retrieved all official equipment or gadgets handed over to the employee during onboarding.

Communicate Employee Departure to Every Department and Complete Paperwork

You must inform other departments like IT, accounts and finance, and administration about the departing employee and the exit date. This is because almost every company department is affected when an employee leaves. 


For example, the IT department must block official access to all company systems. Similarly, the accounts and finance team handles all due payments and finance-related issues of the departing employee. 


Finally, they need to sign off certain official documents before departure. 

Conduct an Exit Interview

One vital step of the employee exit process in HRM is conducting a final exit interview. It gives insights into why the employee is mainly leaving, what areas need to be improved, communicating retention strategies, etc.

Final Settlements and Clearances

Finally, you must ensure the departing employee appropriately hands over all official belongings with proper authentication from different departments. After their clearance is initiated, you can release the final payments, including employed use, additional costs incurred, etc.

How 6 Pence Helps Businesses 

The employee exit management process in your company exhibits the well-structured management you possess. Though it takes your time and resources to understand why an employee is leaving, you get clear insights into where improvement is needed. 


6 Pence is among the leading staff outsourcing and recruitment agencies in the GCC, and we are operational in Dubai, Bahrain, Oman, and Iraq. We help our business partners attract and retain top talents and assist with HR, administrative, and payroll processing. 


We ensure confidentiality, data security, and local and international labour laws compliance. To know more, contact with us today!


Also Read : A Step-by-Step Guide to the Disciplinary Procedure in HRM

Frequently Asked Questions

What is the employee exit process? 

The employee exit process refers to the steps an organisation takes when an employee leaves the company due to retirement, resignation, or termination. 

What is an employee exit checklist? 

An employee exit checklist is a comprehensive clearance document used by multiple departments of an organisation to ensure an employee has cleared each internal function before final settlement and exit formalities.

What are the objectives of exit management?

The primary objective of exit management is to identify areas where business may require improvements, ensure employees remain satisfied with the service, and, in some cases, persuade the departing employee to continue working under different work conditions.

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