3 Best Practices for Effective Offboarding, According to HR Experts (2023 Update)

In February 2023, the U.S. Bureau of Labor Statistics released a stunning report: 50.5 million Americans quit their jobs in 2022, surpassing the previous wave of voluntary departures dubbed the Great Resignation.

For HR professionals, this troubling trend has raised important questions about the offboarding process. When an employee leaves, human resources teams have an opportunity to gather candid feedback and recommend actions that can halt further turnover. Plus, offboarding is necessary to ensure compliance and avoid unnecessary legal risks.

Offboarding is an essential part of maintaining your organization’s reputation, optimizing your current employees’ working experience, and preserving networking opportunities.

Read on to discover the often-overlooked benefits of offboarding, plus tips for improving your company's exit process.

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Offboarding Definition for HR

Offboarding is the process that leads to the formal separation between an employee and a company through resignation, termination, or retirement. It encompasses all the decisions and processes that take place when an employee leaves.

This may include:

Essentially, offboarding ensures there are no loose ends when an employee leaves the company, so you don’t find yourself emailing a former employee two weeks later asking for his or her ID badge, for example. The process is also useful for learning what you might be able to improve for your current and future employees.

Always say goodbye on good terms.

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Why Is the Offboarding Process Important?

When an employee leaves, he or she becomes either an advocate or an antagonist to your company. Advocates will speak highly of you and can send potential new employees your way. Antagonists will not recommend your business to anyone, and that can hurt you in the long run. Try to use offboarding to turn all employees who leave into advocates.

An effective offboarding process helps reduce the chance that misunderstandings will persist after the employee moves on. When you take the time to get a clear understanding of the employee’s experience, you and your employee can part ways with additional opportunities for networking, development, and growth.

1. Offboarding Protects Your Company's Employer Brand

Taking time to understand the employee experience shouldn’t be reserved for offboarding when it’s too late to act. Strengthening connections between employer and employees should be a continuous process, not just an entry on the onboarding checklist. Employees want to know what their future with your company holds—whether they’re deciding to apply or reviewing their everyday work experience.

How job seekers, employees, and the world at large view your company is known as employer brand. Setting up an effective employer brand is essential for recruiting and maintaining healthy talent in your organization. But your employer brand reflects all parts of the employee experience, including offboarding. It’s not enough to give employees a strong start and see how long they stick around.

A report from Execu|Search found that 86% of professionals said they would change jobs if they were offered more opportunities for professional development. A study reported in Fortune went further, showing that the main reason most employees in leadership positions left for new opportunities wasn’t due to insufficient salary or poor management—rather, it was due to boredom and long hours.

Or to put it another way, these employees left because of two major symptoms of employee disengagement.

Most employees in leadership positions seek new opportunities because of boredom and long hours.

Taken together, these two statistics illustrate the importance of employee engagement throughout the employee experience—from onboarding to offboarding and everything in between. In today’s economy, where there are more job openings than job seekers, most of your new hires are part of the 86% who are willing to change jobs for greater professional development. How will they know that your organization provides that development? One of the strongest indicators comes from how current and former employees describe their jobs.

While you have control over how your organization presents itself, your employees have an impact on your reputation as well. A study from Software Advice found that more than 50% of job seekers checked a company’s job reviews on Glassdoor before applying for a job. What’s more, nearly 50% of those who checked online employer reviews did so before doing any other job searching activity. It makes sense—no one wants to waste time applying to organizations with one-star reviews.

With this new level of transparency job seekers have, every decision your organization makes can have a ripple effect on your employer brand. It’s not enough to get employees on board and count on their salary and benefits to keep them from jumping ship. It takes a consistent positive employee experience in every department of your organization and throughout the employee lifecycle to earn good reviews from former employees and build a positive employer brand.

Your offboarding practices give you a final chance to demonstrate your organization’s values to your departing employees, to prove that your organization is what it says it is. This goes a long way toward creating an employer brand that’s deeper and stronger than simple marketing.

2. Offboarding Surfaces Employees' Pain Points

Offboarding presents a rare opportunity for employees to be truly candid about the good, the bad, and the ugly aspects of their experience at your organization. A great workplace isn’t one that minimizes its flaws with effective PR measures. And of all departments, HR likely best understands the importance of resolving issues instead of covering them up.

As Cassie Whitlock, Director of HR at BambooHR, put it in a recent presentation, HR deals with all the ways that “it” can hit the fan—whether “it” refers to legal issues, payroll difficulties, office romance, employee disagreements or the hundreds of other challenges that crop up as organizations grow.

To create a great workplace, HR professionals should view offboarding as an opportunity to recognize issues, help departing employees feel heard, and then take measured steps to grow from good to great.

Keep in mind that effective offboarding can’t be a surprise or an afterthought. Your offboarding process should flow naturally from your regular pattern of employee communication.

Emily White Hodge, Director of HR and Operations at New Moms, a Chicago-based nonprofit, recently implemented this performance management practice: “Our philosophy now is: Don’t wait for the annual review," Hodge says. "There should be nothing that is a surprise on the yearly evaluation. We’re not waiting for a moment to have a magical conversation; we’re more nimble and we’re making changes faster.”

Getting authentic feedback doesn’t always come easily. It can be difficult for some leaders to get out of the cartoon ostrich mentality and tackle employee experience issues, especially if they believe that failure will damage their reputation with their superiors or erode employees' confidence in the organization. But downplaying employees who decide to leave doesn’t remove the consequences of turnover—and in some cases, poor offboarding strategy can backfire and make the situation much worse.

Offboarding is just one of several important conversations that need to happen between employees, managers, and leadership during the employee lifecycle. But while the benefits of regular communication include a stronger sense of purpose and better work outcomes, personal insecurities can cause minor frictions to build up into major issues.

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3. Offboarding Leaves the Door Open for Boomerang Employees

Preserving open communication with employees is key when it comes to aligning their talents with the needs of your organization. When (and most of the time, it’s when, not if) an employee’s career path leads in a different direction than your organization can provide, a careful and thorough offboarding process can leave the door open for reconnection.

Recruiters call these re-hires boomerang employees, and the practice is becoming more common as the competition for talent gets tighter.

Consider these boomerang employee statistics from a recent study by Workplace Trends:

Again, open communication can make all the difference in a successful re-hire. Keeping track of previous employee performance information can help recruiters weigh them against other candidates.

Onboarding and Offboarding: What's the Difference?

Onboarding and offboarding are the bookends of an employee’s time at a company. The terms come from an extended analogy that compares the employee lifecycle with an ocean voyage—they join the organization through the onboarding process and leave through the offboarding process.

While onboarding and offboarding are two very different parts of an employee’s journey, they need to be similarly executed. It’s never as simple as a “you’re hired” or “you’re fired.” Both of those statements come with a myriad of strings attached. The step-by-step process of each should be planned from start to finish, and all the paperwork should be carefully organized.

The complexity of onboarding and offboarding processes depends on the organization, but as in the analogy, the more time and care you take with these processes, the better experience your employees will have. Employees don’t want their onboarding process to be like leaping onto the deck as the ship pulls out of port, and they don’t want their last day with your organization to end with walking the plank.

Both onboarding and offboarding can have elements of uncertainty and risk for employees and organizations alike. Without careful communication, both sides may question the motivation of the other. During onboarding, this often manifests in nervous excitement as the new hire and the organization test the fit of the new employee.

During offboarding, however, the uncertainty is tied to the decisions that led to the employee leaving. In the case of employee resignation, the employer may wonder if there is any way they could have convinced the departing employee to stay. And when employees are terminated or laid off, they may question their employer’s true motivations for letting them go.

Next Steps: Create an Effective Offboarding Process

Examining and investing in your offboarding process can lead to a virtuous cycle of learning from your organization’s mistakes and improving them in the future.

And whether your employees return with new skills or part forever as friends, offboarding can prove to your former, current, and future employees that your organization values their progression and is interested in changing for the better.

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