People & Human Resources

Terminating contractors: An opportunity to manage the process professionally

Eve Ash /

Setbacks can make or break a small business or contractor. The key to survival is to move through the bad phase as effectively as possible and finding the right mantra so you don’t crack when facing a sudden hurdle. Here’s an example:

Jules, a small Australian business owner, has been a contractor to a successful US company for over five years. The relationship grew and both parties enjoyed the success. Sales stopped growing over the last year but remained steady, and still very profitable. A new leadership team was brought in after the US company was acquired by a larger US company. Changes were afoot. The long time relationship manager booked a conference call so Jules could meet a newly appointed manager. Jules looked forward to the early morning call, accommodating east and west coast US time zones, anticipating a friendly meet and greet, and a 2018 strategy discussion.

It was anything but – within a sentence or two from the relationship manager, the new manager jumped in. Three sentences later, Jules got the news that the relationship was over. Jules went into shock and was literally unable to speak, and with emotion clogging every word said, “sorry I am so upset I can’t talk right now, I will need to call back”. Jules broke down and wept.

Jules called back but the conference call had ended, so they called the relationship manager, who listened to Jules vent and also became upset. The ‘why’ was not related to quality – but apparently a change of business direction. The ‘when’ became the bigger issue than the ‘why’ – 90 days.

Jules thought about it for a few hours and got on with new plans, but also decided feedback should be given.

Setbacks can help people grow and become stronger. The critical issue is to minimise the damaged downtime and don’t stay in victim mode, otherwise you’ll be stuck in the past. Immediately get into planning – consider what will replace of this slice of business, how and when. Recognize and conquer any emotional block. One of the best ways is to review the situation and give feedback.

Feedback helps us grow and develop our leadership skills and improve the workplace culture. The new US manager sent Jules an email after the aborted call, offering to talk further. Jules decided to give feedback by email, feeling too bruised to speak confidently.

The key points to the feedback provide an interesting checklist for those about to terminate a contractor when circumstances change:

Be aware of the contractor’s headspace

Be aware your news may be a more powerful blow to the contractor’s survival than you were aware.

When a virtual or face-to-face meeting is booked it is possibly anticipated with enthusiasm by the contractor. If you are a new manager or HR manager about to terminate a longer term provider, you may be a stranger to them, so they may welcome the opportunity to meet and engage with you with a very positive frame of mind in anticipation of building on a long term relationship.

If you are a stranger to the contractor, you will not be aware of where they are at on that day, or week or month…perhaps they are under financial pressures, have health or family issues or some other crisis. You are on a mission to do one thing — not meet and greet, not build on the long term relationship, not get to know the person — you are there to verbally give notice. The problem is it will be perceived as insensitive or harsh.

If you are terminating someone in a different time zone, find an appropriate time for them and don’t say good afternoon if their time is early morning. This is not about you and your time zone, put yourself in their space.

Not many businesses care these days about the cost of an international call – many business discussions these days are on free services like Skype or Facetime, or a pre-arranged conference call, paid for by the organising party. If you are terminating someone via a long distance call, make sure you don’t expect them to make a call they have to pay for on the occasion of being terminated.

Give them warning and do not ambush

When you are planning to terminate a supplier or staff member, give warning. It is only fair and humane. For example, send an email ahead to suggest some challenging decisions are being made about the future of the business, reviewing, streamlining, likely cuts to providers etc. Better still, have the person with whom the contractor has a long term existing relationship soften the blow and prepare the target or be delegated to give the news themselves alongside an HR person. There will be better acceptance within an existing caring relationship than with a stranger who knows little.

Acknowledge their good work

Explain the reasoning clearly and don’t be defensive or blame the supplier if their work is not in question. Don’t go on and on about a business decision and the importance of the future of the business. Once someone has been told it is all over, they will be in an altered or shocked state, not thinking or caring for the future of your business.

You need to be aware of the supplier’s circumstances, their past work, best contributions and acknowledge that. Be aware that there will be repercussions for other members of the supplier’s team who may lose their jobs.

If you are a stranger to them, take the time to find out information so you can provide appropriate acknowledgement and recognition to what may have preceded your era in people, relationships, work and content.

Empathy goes a long way

Think about what you can say to help the person through a tough time ahead. What can you do to soften the blow? Don’t be so focused on how you will cut them, think about how you will help them move forward. Genuine empathy is needed — an appropriate and sensitive approach.

Don’t use the excuse that it is cut and dried business and that is how management want to handle it. You are responsible for your personal style.

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Eve Ash

Eve Ash is a psychologist, author, filmmaker, public speaker and entrepreneur. She runs Seven Dimensions, a company specialising in training resources for the workplace.

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