SurePayroll Insights Survey: Business Owners Share Opinions and Advice on Firing People

CHICAGO — March 19, 2007 — Donald Trump may find it easy to tell people "You're fired!" but most small business owners don't enjoy having to terminate employees, according to results from a recent survey by online payroll service SurePayroll.

61% of surveyed business owners find it tough to fire an employee. Also, 60% of respondents indicated that firing employees doesn't get easier over time. As part of the survey, small business owners offered a variety of tips to their fellow entrepreneurs on how to approach firing an employee.

SurePayroll surveyed business owners on human resources (HR) issues in conjunction with its recent introduction of SureAdvisor, an add-on service to SurePayroll's payroll outsourcing service that provides small business owners with in-depth advice on complex human resources challenges.

SureAdvisor allows business owners to download HR compliance posters at no charge. It also provides instant access to many how-to guides and HR best practices. SureAdvisor is a premium service, offered in addition to SurePayroll's regular payroll processing, and is available to all SurePayroll customers at no charge for three months.

- Many Business Owners Regret Not Firing Soon Enough

78% of survey respondents acknowledged that they had kept an employee on staff longer than they should have.

Reasons for delaying termination included not being able to find an adequate replacement candidate, giving the employee a chance to improve, fear of employee retaliation, fear of hurting the employee's feelings, fear of a lawsuit, not wanting to deal with the stress of firing an employee, concern regarding office morale and empathy for the employee's personal situation.

"None of these is a good reason to avoid firing an employee if you really don't think they can improve," notes SurePayroll President Michael Alter. "My advice to business owners is that they need to be slow to hire and quick to fire."

- Biggest Reason for Termination: No Will to Perform

The primary reason (66%) a business owner terminates an employee is for lack of will or desire to perform. Other reasons, in order of frequency, included Attitude Problems, Inadequate Skills and Attendance Issues.

- When Fired, Employees' Primary Reaction Is Sadness

Most small business owners listed sadness (26%) as the primary reaction of an employee upon termination. Anger came in second (22%), followed by Empathy / Understanding (21%). Other reactions that commonly occur during firing are Surprise (14%) and Relief (7%).

- Advice on Terminating Employees

The majority (53%) of businesses surveyed had no formal termination process in place.

"If there's no rule book on terminating employees, everything is ambiguous," notes Alter. "That can lead to a failure to fire employees who ought to be terminated and can even lead to legal issues if terminations are viewed by employees as being unfair."

Alter offers the following tips on firing employees:

- Avoid Surprises - Business owners need to let employees know what's expected of them and when they are not meeting expectations.

- Offer COBRA Coverage - Don't forget to offer health care continuation coverage as required by the federal Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA).

- Conduct Exit Interviews - Conducting an exit interview with a terminated employee allows you to gather information that can be used to improve an organization's work procedures, supervisory practices and training efforts.

About SurePayroll:

Privately held SurePayroll is America's fifth largest full-service payroll provider and the nation's largest online full-service payroll provider.

In addition to providing payroll services directly to small business, SurePayroll also provides a private-label payroll service that allows SurePayroll's numerous partners to offer payroll processing to their small business clients. For more information, visit www.surepayroll.com.