Before You Terminate the Chief Officer

You undoubtedly already have a set of procedures you follow at terminations. That’s good.  You should.

But I’ve noticed over the years in many companies that at the point when the board or the CEO gets fed up with an executive and wants them terminated, even regular termination procedures are often abandoned. That’s not good. You shouldn’t!

Executives are not like the rest of us! They have to be treated differently, even – maybe especially – at termination.

Here are a few things to remember.

  1. The Executive Agreement – Most execs come in with an executive agreement. Make sure all the terms and conditions within that agreement are met…adhered to…followed…complied with. When big bosses want to get rid of littler bosses, they sometimes forget that there was a big fat contract wooing them into the company initially. Forget about that contract, and the “woo” becomes a “boo”. (That was corny, but you get the point.)
  2. Wage Payment at termination and leave accrual pay out laws – Related to the above, many executives have unique leave accruals and end up with many weeks of leave.
    • Most states require the payout of accrued leave unless there is a written, express, clear, unambiguous policy to the contrary. Some states even say you can’t have a policy that results in the forfeiture of earned time. Be careful to give the outgoing exec what they get in earned time and
    • within the time they must get it! Most states have wage payment at termination/discharge/resignation laws.
  3. Dignity and Respect – Finally, the way the termination is handled affects the employees who are watching. Even if the CEO hated the CFO, the Accounting team may’ve loved him. The CEO shouldn’t want to turn the Finance Folks into Foes. Even if the CFO was without dignity upon or leading to termination, the company should generally take the higher road and make sure the transition was as smooth and respectable as possible.



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