Having to part ways with an employee because they don’t measure up is one of the toughest parts of any manager and leader’s job. But what’s worse is having to let someone go who is a real asset to the company.

It happens all the time. Your organization merges two divisions, eliminates an entire department, scales back a budget line and suddenly there are employees — people who are talented and hardworking and an asset to the business — who no longer have a position. You take a long look at your company’s org chart, but it just isn’t possible to keep everyone.

I’ve written before about how an employee can leave a job without burning bridges. It’s equally important for a manager to know how to part ways with an employee. As I’ve pointed out, many of the people you work with today are going to be important to you at some point in the future. They’ll work for you, or work alongside you, or — and this happens more often than you think — end up being your boss.

It’s something we’ve seen happen here at JBC and Janou Pakter, both in our own company and those we work with on a daily basis. We’ve seen employees who’ve left a company for whatever reason who have ended up becoming the point of contact at one of its client organizations. That often means that their former boss now has to answer to them.  Sometimes former employees start their own companies and end up hiring their former manager.

Here are a few steps you should take to ensure that you maintain a good relationship with people who you have to let go:

Don’t take them by surprise. When times are hard, it’s best to prepare employees for a potential downsizing. That way you can manage expectations rather than giving false hope. If the issues with the employee are performance or even culture based, then hopefully you have taken every step to give feedback and an opportunity to develop and grow. In any case, a clear timeline for action and open lines of communication will foster a better level of understanding between employer and employee.

Treat them with respect. Whether or not someone has been an asset to the company, make sure that you treat them humanely when letting them go. You can explain that while the decision is irreversible, you appreciate all that they gave in their time at the company and that you will do what you can to ensure that the transition is smooth. Depending on the situation, emotions may run high from both the employee and employer perspective, but it’s best to keep a calm and understanding demeanor. Whatever you can do to protect the dignity and privacy of the employee will be appreciated in the long run.

There’s another reason to treat the people you are letting go with respect: It has a direct impact on the rest of your employees. In today’s digital and social age everyone is aware of everything, and how you handle the situation and how you treat the people who are leaving reflects on you and your company. If other employees think you handled it poorly, morale is going to suffer.   

Make sure they are paid right away. Pay your employee for time worked, unused vacation days, bonuses, commissions, or any other pending payments on their last day. That way they can walk away with everything in-hand and not have to worry whether your company is withholding what they owe them, causing resentment or bad reviews, ratings, and potentially permanent damage to your company’s reputation.

Offer them a good severance. Particularly when an employee is being let go due to unforeseen circumstances and not poor performance, severance pay is one of the ways you can take some of the financial stress off their shoulders as they look for a new job. If this simply isn’t in your budget, make sure to offer them resources to help them sign up for unemployment assistance and even pursue new opportunities elsewhere with your recommendation or support. 

Provide other benefits. Extended health benefits, career counseling, and other services are greatly appreciated by departing employees. Another benefit is outplacement services, which can include things like resume writing, interview coaching, and career assessments. JBC offers outplacement services for its client companies and outplacement services aren’t just a nice thing to offer departing employees. They’re an in-demand benefit for people on the job market.

Check in with them. If you have a good relationship with the former employee, checking in with them might be a good idea. If they are someone you could see yourself hiring in the future, it doesn’t hurt to reach out.

With the economy rebounding, a lot of companies are putting more and more effort into their hiring procedures but I’d say that how we let people go is just as important. Having a good reputation for how we treat people makes our current employees more likely to stay and helps us attract the best possible new talent.