Holiday Terminations: Scrooge or Chicken?

This year, my first holiday termination conversation came on November 20th; a bit early in the season. Like traditionalists who hold off on Christmas decorations until after Thanksgiving Day, most business owners start avoiding termination announcements a few weeks before the holidays.With the Great Pumpkin replacing Macy’s Santa as the official harbinger of the holidays, and “Black Friday” sales starting on Thanksgiving morning, bosses are feeling the pressure of maintaining “Holiday Cheer” in the workplace for almost one-fifth of the working year.

This conversation was typical. “We need to cut costs, and have drawn up a list of folks we will be terminating. Because of the holidays, we will wait until the beginning of the year to make our announcements.”

Who benefits from waiting until after the holidays for a planned termination? Is it really the employee? When the credit card bills come in January for that last surge of overspending on gifts, will the employee say “Boy, I’m glad I didn’t know I was getting fired. I would never have had the nerve to go this far into debt?”

In reality, delaying terminations until just after the holidays is usually because the boss is a chicken. We worry that the social celebration that comes at this time of year will remind our employees what a rotten Scrooge we are if we’ve just fired someone. We imagine handing out holiday bonuses to people who say “thank you” but are really thinking about what you did to poor Cratchett, who occupied the now-empty cubicle next to them. We visualize holiday parties where friends of the ex-employee stand around the punchbowl talking about what Bob’s rotten boss did to him last week.

Terminating someone before the holidays helps them to budget rationally, and allows them to utilize the best networking time of year to get the word out about their availability. Despite the benefits, I won’t pretend that anyone will consider a pre-holiday termination an act of kindness. Job hunting in the weeks before the New Year is still a largely futile endeavor.

If you really want to be generous, terminate the employee with a substantial cash sum in hand. You might use any accrued vacation for part of it, but with prepaid holiday compensation and a bit more you can probably get them through the first of the year.

I know that it sounds ridiculous to pay extra to an employee you are firing. I can hear the arguments: “We don’t do that for anyone else.” (But you don’t fire other people during the annual doldrums in the job market.) “We can’t reward someone for doing a poor job.” (But it isn’t a reward, it is a gift.) “The other employees will feel that we aren’t being fair to them.” (True, but they aren’t going to praise you anyway.)

From a practical perspective, there is little or no difference between paying the employee now, and paying him to hang around for another month. To start, the employee was presumably an underperformer or redundant, that is why we are having this discussion. Throw in paid time off, a holiday bonus, and a typically slow time for most businesses and you have the worst ratio of the year between pay and productivity .

On the other hand, you have a chance to avoid being either a Scrooge or a chicken. Your announcement to the employees can go like this: “We have terminated Bob. Because this is an especially difficult time of year to be job hunting, we have arranged to pay him through the holidays while he seeks another position.”

It may not make you into Santa Clause, but you will feel better, and it will help shore up your punchbowl reputation.