Termination Package Documents in CA – 2024
By VICKY BROWN
Alright, you’ve decided it’s time to let someone go. Well, before you pull the trigger – there’s a bit of prep work you need to do.
Now here’s a surprise. I bet you though I was going to go on and on about, have you documented the performance issues, have you had conversations with her, will this be a complete surprise.
Well – I’m not. That’s because I’m going to assume we’re past that point, and you’ve done all the things, and said all the words – and now it’s down to the final steps.
So, before you call her in and spill the beans, you’re going to need to prep. Because you have to have all your ducks in a row before you sever the relationship.
You’ll need to calculate and cut her final check. Are you giving her any notice, or any type of separation package? You’ll need to figure out how you’re going to deal with access and security. You’ll need to have a plan for getting her work done while you’re finding someone to replace her. And you’ll need a communication plan for telling the rest of the team that she has transitioned out of the company.
But OK – let’s assume you have all that pulled together. Now we can concentrate on the actual documents that should be in the Termination Package. And remember, these are all the documents you are going to actually hand over to her during the termination meeting.
First up is the cover letter. This is the document that tells her what’s in the rest of the package. It should cover things like specifically outlining her final day of employment. What’s going to happen with her benefits. And while this is usually a reference to future COBRA documents coming under separate cover, I think it’s helpful to mention the specific date various benefits will end. Generally for medical, it’s the last day of the termination month. But for the other plans, things like vision and life insurance, it’s the last day of employment. So it helps to spell it out for her.
And then list the other documents in the package, as well as her final paycheck.
So speaking of final paycheck, yes – you have to pay her everything that’s due on termination. Now again, I’m talking about California and other states may be slightly different. But in California you have to pay her everything on her final check. Left over vacation or PTO, commissions – any and all wages have to be on that last paycheck. And if you don’t have enough information to calculate the commissions yet, then you have to pay them out as soon as possible.
Now you’re probably thinking, “what’s the rush” – well my friend, California is the rush. If you don’t get that check to her on her last day, for every day that’s it late, you have to pay her daily rate. That can really add up, quickly. And yes, holidays and weekends count.
So see – that’s why you need to have this piece squared away before you utter a peep to her.
Now next you’ll need the Change of Relationship Notice. It’s a document that is a written notice of the change in employment status. The state requires it under the Unemployment Code – and in fact it’s used by the Unemployment folks to help determine eligibility. This is always required, no matter if the person is terminated or resigns. So be sure to fill it out, as required, and put it in the term package.
“…before you call her in and spill the beans, you’re going to need to prep. Because you have to have all your ducks in a row before you sever the relationship.”
Alright, the next thing isn’t a requirement, but it’s a ‘really good to have’. A form that is a checklist, signed by both of you, showing what was returned and what wasn’t. Keys, ID card, laptop – any and all company materials or equipment should be listed and acknowledged. We call ours a Separation Data Sheet, but you can call yours anything you want. Either way, believe me – it’s just better to have something than not. It really cuts down on the “I returned that”, “ No you didn’t dialogue.
There are some state notices you’ll need too. There’s the CA Dept of Health Care Services Notice. This form covered the state’s Health Insurance Premium Payment Program. Basically it outlines who’s eligible and what the program is.
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Next we have the CA booklet on Programs for the Unemployed. And yes, even though you’re firing her – you still have to give Mary information about the state’s unemployment insurance, in case she wants to file.
Now it doesn’t mean you’re going to support it, but you do have to give her the information.
If any of your benefit’s plan are portable – meaning the employee can start paying the premium fully and take the coverage with them (I usually see this with life insurance plans), then give them that information and whatever forms are required as well.
Make sure to give Mary everything with her final check, and be sure that the COBRA documents are prepped and sent within the designated timeframe. Now hopefully, if your team is small enough, all the COBRA maintenance may run through the insurance carrier. But if you have 20 or more employees, you’ll have to either do it in house or contract with a company to administrate it for you.
If all this seems overwhelming, don’t worry. I’ve included a link to our checklist. And we’ll also get you the documents you’ll need for the package.