Long reads

Don't hire new staff – get the old ones back

23 Aug 2018 By Jo Faragher

When a valued employee hands in their notice, it’s not the end of the story. With a bit of investment, and some solid relationship-building, they’ll never actually leave you

If the employment cycle were a romantic relationship, it’s fair to say it would be more Love Island than Pride and Prejudice. As employers, we spend a disproportionate amount of energy wooing and attracting individuals into our ranks. We lavish thousands on recruitment marketing and onboarding – in essence, the courtship phase – as we try to convince the object of our desires we are a suitable match. When things have fizzled out, however, it’s pretty rare we make the effort to even remain on speaking terms.

 “We’ve tended to view the end of the working relationship as a zero-sum game – that it’s bad news – so historically we’ve given it little attention,” says David Collings, professor of human resource management at Dublin City University. “But the landscape of work has changed significantly in the past couple of decades. Here in the UK, average tenure is around five to six years, while in Silicon Valley it can be as little as two. So given how long someone spends in the organisation, there’s a strong case to think differently about the end of that relationship.” 

When employees leave, they are metaphorically – and in some cases literally – ostracised and almost treated as ‘outsiders’. At its most comical, this leads to them spending their final day at work deactivating President Trump’s account (as one disgruntled Twitter departee did) or, in the case of a former Jetblue airline steward, activating the evacuation chute, swearing at passengers and sliding away, beer in hand. More seriously, in an age of online employer branding, we simply can’t afford to lose the goodwill of departing employees or have them actively cynical when their exit looms.

That’s part of the reason why businesses are beginning to take the end of the employee life cycle seriously – whether by investing in efforts to keep former staff engaged and useful or ensuring they capture their thoughts in order to improve the employee experience for others. 

There are other factors at play, too, says Tony Audino, founder of Conenza, a business that develops employer alumni platforms: “Baby boomers are now starting to leave, and organisations want to avoid losing all that intellectual capital. At the same time, younger employees are not staying around as long, which all means companies need to maintain longer-term relationships. Everyone will leave at some point and the potential impact on employer brand is significant.” 

Audino originally worked for Microsoft, where he created one of the first major employee alumni communities, and he argues that the way we keep in touch with former colleagues has changed dramatically. A decade ago, talent acquisition ruled supreme, he says, but today brand advocacy is a broader concern: nobody wants future employees or customers to be trashing your business because you’re a bad employer, so leaving on a positive note is a matter of good PR.

Alumni networks are the most obvious way of keeping the post-employment vibe positive. Deloitte has one of the largest and most successful around, with more than 14,000 members. Its LinkedIn group for alumni has more than 6,500 subscribers, and it connects with former employees via email every month. The firm has also just launched an alumni talent network as a dedicated way to offer roles to leavers and their connections. Former colleagues are also invited to several face-to-face events a year, based on hot topics such as Brexit, or career development themes such as becoming a non-executive director. 

“We don’t expect people to join us as graduates and spend their next 20 years here,” says partner and alumni lead Mike Meehan. “A huge percentage of our employees go on to work for clients, so there’s a positive business impact for us.”

While the organisation recognises the opportunity for potential new or repeat revenue from its former employees, it’s not something it measures. Having access to a pool of ready-made talent that already knows Deloitte has proven beneficial in itself. “Fifteen years ago, the composition of our talent network would have been graduates working up to a professional career, but this has changed massively,” says Meehan. “Now we see lots of contractors or other people coming back to us as associates.” 

Rehiring has also been a positive outcome of the alumni network at market research company Nielsen. It recently ran an alumni week in one office that resulted in three of the 35 attendees signing up to return; it also offers “boomerang webinars”, targeted at former employees who want to learn more about where the business is now. 

“Many of our former employees go on to have successful careers so can be great for referrals, because they know what it takes to thrive here. In many cases people come back, refer business and speak positively about us, so it makes sense to keep in touch,” says Dan Klamm, director of alumni relations. 

Collings agrees that rehiring former colleagues can prove cheaper and more effective because companies tend to offer a salary premium to new external hires. “They perform at a higher level, and progress through the company even quicker than those who have been there through their absence. They seem to gain a boost when they come back,” he adds. 

Beyond formal networks, there are common-sense measures employers can take once someone has handed in their notice. “You need to think about who’s leaving, where they’re going and this will determine the type of exit,” says Collings. “Compare a strategically important person going to a competitor who is likely to go on garden leave, versus someone who’s going to a client – you’ll focus your attention on the latter.” 

Clearly, in some instances the exit may not have been the individual’s choice, but here it can help to offer support with CV writing and outplacement. Many companies run exit interviews to gauge reasons for leaving or to get feedback, but Collings queries their validity. 
“I think the value of exit interviews is open to question. It all depends on the real reason someone is leaving and their relationship with their manager,” he says. 

“Some employers now turn to external companies to do a follow-up chat with someone further down the line. This is after the rawness has gone, and they may be more willing to be honest about what happened because they have some distance.” 

Those final few weeks in a role, where an employee’s mind is likely to be somewhere else, need not be a lost cause either. At Deloitte, managers help departing employees to ‘land well’ if they’re moving to a client, for example by connecting them with the right people in Deloitte who service that business. Establishing how you will transfer any important knowledge or skills is also crucial – whether that’s through a simple handover with the person coming into the role or something more sophisticated. NASA’s Jet Propulsion Labs videos veteran employees lecturing on what it was like to be part of missions, and uses this for new employee inductions. 

Taking a more personalised approach to how you treat leavers can also reap benefits. Accountancy firm BDO has more than 5,200 alumni in its formal network, and while there are central communications and events for all subscribers, it’s all about keeping things local and specific. 

“As a business, we’re organised into different disciplines such as tax, audit, business restructuring, corporate finance. Then those disciplines operate in different sectors or regions such as consumer markets, professional services, real estate, media and technology and natural resources,” says Ian Clayden, a partner in BDO’s consumer markets group. “All these sectors or regions have their own networks and events. We share relevant intellectual capital with them, and them with us. This is where we build our deepest relationships, at the local or sector level.”

As companies look to build more agile and flexible workforces that blur the lines between full-time staff seeking careers and the growing army of consultants, freelancers and casuals, access to such skills and knowledge will grow in importance – whether that’s former employees coming back for a short contract or in a mentoring capacity. 

Audino says that to thrive in this environment requires having an open culture rather than one that shuts out former staff, especially if they’ve gone to competitors. “Some companies offer access to learning modules after staff leave, so if they decide to return they keep relevant skills up to date. It’s also important to let staff know if any exit feedback they’ve given has been taken on board, and changes made,” he adds. 

And Collings adds that some level of turnover is healthy. 
“A manager might tell an employee that they think they have plateaued in a certain role and that some time in an external organisation would help,” he suggests. “They come back more rounded and you can always get them back into the right role when the time comes. Tenure can impact on performance – someone might expect a linear progression through the company but become frustrated they’re not getting it, or they become complacent.” 

Whatever their approach, there’s a growing acceptance among employers that staff won’t stay around forever. But that shouldn’t stop them treating them as though they will. For BDO, departing employees are simply part of a bigger family that looks out for each other and offers support when needed. “We know a high proportion of our employees join us when they’re young and starting their accountancy training,” adds Clayden. “After that, many go out of practice and into industry, so we already know a high proportion will become alumni from the day they start. We treat them as part of our family from day one, preparing them for a future whether they’re physically working for us or somewhere else.”  

“Returning just made sense”

Fiona Raistrick (pictured) worked for accountancy firm BDO for seven years until 2011. After three years with the Financial Conduct Authority, she decided to return to BDO as partner in the financial services advisory practice.

“When I left BDO, it was because I didn’t see a long-term career there due to the way the business was structured at the time. But I enjoyed my time with the firm a lot. And when my new employer moved offices, meaning I would have had a two-hour commute soon after maternity leave, it made sense to come back.

“I had maintained relationships with people while I was away. And all the things I had missed – the culture, the appetite to grow – were still here when I returned. Being back has been brilliant.

“It just makes sense to stay in touch with people who leave –it’s not unusual in this industry. It means you’re ready when and if 
they ever want to come back. And most people find jobs through their network – if you have those informal links with former colleagues, 
even if that’s just because you see them socially, it really helps.”

The legality of leaving 

As well as ensuring someone is a positive ambassador after they leave, there are certain actions employers can take to ensure an exit is legally watertight too, and that they are reasonably protected from future tribunal claims. 

The end date 

“How will you deal with their notice period? Do you want them to work out their notice in the office or go on gardening leave?” asks Amy Richardson, associate solicitor at law firm Coffin Mew. You can cut short an individual’s notice period, but both parties need to agree to this, she adds – if one side wants to enforce it, the notice must be worked. Firming up the last day of employment is also essential for working out accrued holiday and any other payments due.

Restrictive covenants 

Consider whether there are any restrictions in the original employment contract, such as requiring someone not to work for a competitor for a certain amount of time. The popularity of such arrangements has waned over time; it is possible to arrange some flexibility in restrictive covenants, adds Richardson, as long as this is agreed in writing. “Employees might also argue that the restrictions are unreasonable, so it’s best to check contracts to see whether these covenants are reasonable or enforceable.”

Payment in lieu of notice 

In April 2018, the rules changed around how to offer payment instead of the employee working out their notice. Now, if an employee is paid in lieu of some or all of their notice period, the employer must deduct income tax and employee National Insurance contributions from this amount and pay employer NI on it. 

Settlement agreements 

Research has found that settlement agreements – often containing so-called “gagging clauses” – have been frequently misused across many sectors. While they may be appropriate in certain narrow circumstances – but must never be used to prevent whistleblowing –  Beth Hale, technical director at CM Murray LLP, says there are better ways to protect your reputation: “It doesn’t make sense to require all departing employees to sign a settlement agreement. However, even if an employee is leaving in apparently uncontentious circumstances, it’s sensible to carry out an exit interview and follow up on any concerns raised. This employee may not be intending to bring a claim, but this might be able to flag up problem areas, which can be addressed to avoid future issues.” 

Intellectual property 

When it comes to protecting contacts, intellectual property or sensitive information, this should have been ironed out in the original contract, says David Israel from the employment team at Royds Withy King. “If someone takes a client list, that’s easier to prove, as it has a value to the business, otherwise it’s hard to police. Get the contract right when they’re happy rather than trying to enforce an implied duty at the end,” he says. 

Company property

Company equipment such as mobile phones and cars should be handed back, although employees may want to transfer a vehicle lease or keep their number. 

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