Employee Offboarding Checklist: The Ultimate Guide

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Bruna Vasconcelos
Bruna Vasconcelos
Head of People

Table of Contents

Your offboarding process will vary depending on your organization, the industry, and even the employee's role. However, there are some core components that every offboarding strategy should cover.
Published on
October 4, 2022
Updated on
April 11, 2024

Employee offboarding doesn't get as much attention and effort as employee onboarding. While it's natural to enjoy welcoming new employees, it's also important to make sure that your employees who are leaving are given a graceful exit. Parting ways on a positive note benefits everyone by keeping the work environment welcoming and leaving opportunities open for improvement. Employee offboarding is essential to mitigate security and legal risks and an effective way to gather valuable feedback so you can improve employee retention in the future.

A formalized employee offboarding procedure also increases the likelihood that good employees will return to your company later. Employees who leave and then return are referred to as "boomerang employees" and are desirable in a tight labor market. In this article, we'll discuss how you can ensure your departing employees have a smooth exit and how you can use the process to improve your company.

What Is Offboarding?

Offboarding formally separates an employee from an organization through resignation, termination, or retirement. Every company's offboarding process will be different, but it includes all the steps that are triggered when an employee leaves, such as:

  • Reassigning the employee's job responsibilities
  • Turning in equipment and other company property
  • Closing accounts and removing access
  • Conducting an exit interview

Why Is Offboarding So Important?

When an employee leaves your company, regardless of the reason, they should be recognized. Even if they aren't leaving on the best of terms, how you treat departing employees sends a message to your current employees about how much you value them. Employees who are treated well when they leave are also more likely to come back later if their circumstances change.

A formal offboarding process reduces the chances of misunderstandings and hard feelings. When you take the time to listen to and understand the employee's experience with your company, you're more likely to part ways amicably and have future opportunities for connecting and networking. You can also gain insight into your company that you can't get any other way. Even if you're regularly soliciting feedback from your employees, they probably aren't as willing to give unfiltered feedback as departing employees are.

Finally, having an offboarding process ensures that you don't overlook possible financial and security risks. If an employee has access to company financial accounts, you'll need to cut that off. You also must ensure that all access to your network is blocked and computer accounts are deleted to avoid cybersecurity risks. Improperly offboarding an employee poses significant security risks, but 48% of companies report that they know former employees still have network access, according to Tech Republic. This is despite the fact that 20% of businesses have experienced data breaches by ex-employees.

Benefits of Offboarding

A smooth and effective offboarding process benefits your company in many ways, including:

Building trust with current employees

If your current employees see that you treat your employees well even when they're leaving, you'll build trust and morale. They'll have more faith that your company's values aren't just a corporate motto.

Learning more about your business

Exiting employees can tell you things about your business that no one else can. As long as you make them feel comfortable and let them know you value their honest feedback, they will give you information your current employees may not be able to. Their negative feedback can help you create a better work environment, and they can also give you positive feedback about what processes are working well.

Replacing critical skills

A thorough offboarding procedure can help prevent the loss of singular skills. By working through the transfer of knowledge, you can avoid a situation where the only employee who knew how to handle a particular task has left. As part of your offboarding process, walk through their role with the exiting employee and make sure there are no elements of their job that only they know how to do. If there are, you can plan the transfer of knowledge so that business operations continue as usual.

Mitigating cybersecurity risks

Cybercrimes are a growing concern for all types of businesses. Disgruntled employees with access to your company's data are a cybersecurity risk, but even if your employee is leaving on good terms and is trustworthy, open accounts increase your attack surface. Your offboarding plan should include provisions to close all of the employee's open accounts and revoke their credentials.

Ending on a positive note

Offboarding allows you to provide a positive experience for your employees that spans their entire time with you. When you show them you value them throughout the process, they'll leave on a positive note without feeling like they're burning a bridge. If you simply rush an employee out the door when they resign, they can leave with a negative impression of your company. It's much better to maintain a good relationship with departing employees and keep the door open for future opportunities.

How to Offboard an Employee

Your offboarding process will vary depending on your organization, the industry, and even the employee's role. However, there are some core components that every offboarding strategy should cover:

  • Create an offboarding checklist
  • Address compliance issues
  • Assign responsibility for tasks to the appropriate department
  • Include all stakeholders in the plan
  • Formalize mandatory offboarding for all roles
  • Reevaluate and update your process as needed

How to automate the employee offboarding process

Using software can simplify the offboarding process. Offboarding software lets you automate the offboarding process, ensures nothing is overlooked, facilitates communication between management and the exiting employee, and provides centralized storage of all paperwork.

To automate offboarding effectively, you need to identify the individual workflows you want to automate. Here are some common workflows that can be automated:

  • Deprovisioning: Removing the employee's access to applications, systems, and data within your network
  • Security alerts: Notify the appropriate department if there's concerning behavior
  • Exit interviews: Scheduling with the departing employee and ensuring feedback is routed to the right place
  • Updating payroll: Ensuring the employee is paid accurately for their final days and any outstanding benefits

After you've identified the workflows you want to automate, you can use software to connect the relevant systems and create a trigger for the corresponding actions.

Offboarding Checklist template

Creating a checklist is the first step in formalizing your offboarding procedure. Whether you're automating offboarding or handling it manually, you'll need a checklist to ensure you don't forget any steps in the process. You may need more than one checklist, since you may have different requirements based on the employee's role. However, you can start with a general checklist and then adjust it based on the employee's role and the type of separation.

Prepare documentation for dismissal

Gather all the documents the employee will need to sign, such as a resignation letter, which should note the last working day clearly. HR should also collect all the documents the employee has signed in the past, such as non-disclosure agreements, employment contracts, benefits documents, etc.

Notify team members and stakeholders about the employee's departure

The easiest way to do this is through an email that specifies:

  • The reason the employee is leaving, if appropriate
  • The employee's last working day
  • If the employee is being replaced and by whom, if you've already made arrangements
  • Information about how the exiting employee's work will be handled
  • Information about a farewell party for the exiting employee
  • Appreciation for the work the departing employee has done

Plan for the transfer of knowledge and duties

Make a plan to wrap up as many outstanding tasks before the employee leaves as possible. You should also ensure that the employee's eventual replacement will have access to all of the knowledge they need to do their job. This might include notes and information the departing employee has about specific accounts or clients. Decide who will receive the employee's forwarded calls and emails if you haven't hired a replacement yet.

Recover the company's equipment and property

If you've provided the employee with any equipment, decide on a procedure to collect it before the employee leaves. This may include items such as:

  • Computer
  • Cell phone
  • Uniform
  • Credit card
  • ID card
  • Keys
  • Parking permit

Create a checklist of equipment that needs to be returned for each role. Make sure a manager or someone in HR checks the equipment as it's returned. Equipment that isn't returned is not only a financial loss, but it's also a significant security risk.

Communicate with the employee's external clients

If the employee dealt directly with customers who expect to deal with them, notify them about the change. If the employee is leaving on good terms, they can communicate directly with their clients and introduce them to their replacement, if possible. If that's not possible, have a manager talk to the clients and assure them they'll be taken care of.

Remove all permissions and access

Open accounts from ex-employees are a cybersecurity risk. Failure to remove permissions and access can lead to:

  • Data loss
  • Compliance violations
  • Data breaches
  • Breaches of confidentiality

Notify IT and accounting of the employee's last day so they can revoke access and permission to all company accounts.

Conduct an exit interview

Although you can do an exit interview with all departing employees, it's particularly beneficial to interview exit interviews with employees who have resigned. An exit interview will let you collect information from the departing employee that can help you understand why they're leaving and if there's anything you can do to improve employee retention in the future.

An HR representative should conduct the interview rather than the employee's manager. The employee is likely to be more open with someone other than their direct manager. The point of an exit interview is to get feedback that will help you improve your working conditions or company culture, so you want to make the exiting employee as comfortable as possible.

The questions you ask will depend on the employee's role and your company's environment, but some general questions that are widely applicable are:

  • Why did you decide to look for another job?
  • What would motivate you to return to our company?
  • Were there any company policies you didn't understand or were frustrating?
  • Do you feel you had the tools, resources, and conditions to succeed in your role? If not, what would have helped?
  • Do you feel you had the right training to be successful in your role? If not, what did you need?
  • What was the best part of working here?
  • What was the worst part of working here?
  • What are you looking forward to in your new job?
  • Describe the ideal candidate to replace you.
  • Would you recommend our company to a friend looking for a job?
  • Is there anything else you'd like to add?

After you finish the exit interview, make sure the employee's feedback gets routed to the appropriate department for evaluation.

Settle the employee's accounts

Notify payroll so they can remove the employee from payroll and settle their last paycheck, payment of benefits, and other expense accounts.

End the employee's benefits

HR should end any benefit plans the employee is enrolled in and send them any paperwork they need to roll over accounts.

Arrange a farewell

You should always show appreciation for departing employees. Circulate a farewell card and have a cake or get together for lunch or dinner to wish them well in their new endeavor.

Offboarding for Future Success

While it may not be as enjoyable as onboarding, offboarding employees is essential for your company. You should start by making a comprehensive checklist so you won't forget anything. Automating the process can simplify it and make it easier to coordinate among teams. An effective offboarding process will protect your company and limit possible problems while making everyone feel better about an employee leaving.

As you gain more experience with offboarding, you can tweak your procedure to make it work better for your company. Acting on feedback from your exit interviews can help you create a better workplace environment for your employees who are remaining. The insights you gain from offboarding can help you create policies that reduce employee turnover and increase employee satisfaction, making your company stronger in the process.

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