When it comes to offboarding, we differentiate between voluntary and involuntary employee departures. In either case, we ask that you give us as much notice as possible and involve us from the start, so we can better support and guide you through the offboarding process.
Terminating an international employee is never easy. That’s why here at Plane, we try to make parting ways as painless as possible for both employers and employees alike. Here’s a quick guide on how to initiate employee offboarding through Plane.
Involuntary offboarding (Termination) refers to when the employer decides to end the employment with the employee. However, such terminations outside the US can be tricky and time-consuming for employers. If you are planning to terminate an employee, please reach out to support@plane.com right from the start or directly initiate the termination via Plane. We will then provide details to discuss the possibilities and timeline specific to the case.
In most cases, an employee termination requires cause — you will need to have a valid and justifiable reason to terminate an employee. An employee termination should be treated as a last resort, proving that the employer has considered all other options before turning to termination.
For example, say you have an employee who went through a performance improvement plan and received three written warnings, but still fails to meet expectations. You must have documentation of these instances and results.
If you do not have a justifiable reason to dismiss an employee, they may be able to take legal action against you for unfair dismissal — a lengthy, costly process that all parties should strive to avoid.
ℹ️ Important Notes
Probation period: We recommend including a probation period in each employment contract to protect both, yourself and the employee. This usually ranges between 3 to 6 months, depending on the country.
Timeline: The offboarding process and timelines differs from case to case. In some cases, it may take up to 3 months to terminate an employee.
Statutory termination terms: You can review and refer to employees’ employment contracts for the most accurate information regarding terminations.
Documentation (if applicable): Performance improvement plan, written warnings, misconduct, or any info relevant to termination or dismissal.
Outside of the U.S., “at will” termination is not common. In most countries, an employer must have a valid, just cause to terminate an employee.
Plane does not usually facilitate unilateral terminations or dismissals, due to risk of litigation that can expose employers to increased damages. Also, the grounds for these terminations may not be valid for an Employer of Record.
Mutual Termination Agreements
For involuntary offboarding, Plane employs the practice of Mutual Termination Agreements (MTAs) (Canada: Waiver and Release letters), which enable employers to terminate employees while minimizing costs and the risk of litigation. These agreements cover unused leave, notice periods, severance, and negotiated terms, in exchange for the employee to sign the letter and thus waive their right to challenge the termination/pursue legal action.
It’s important to note that employees cannot be forced or coerced into signing an MTA if they do not wish to do so.
In case an MTA is not applicable, we will conduct a thorough legal investigation, gathering information about the reason for the termination/dismissal. The purpose of this investigation is to ensure that an employee termination is conducted in full legal compliance with any relevant labor laws. Based on our findings, we will determine whether there is enough supporting evidence to proceed with a termination notice without requiring any additional agreements.
Steps and process
Once you have decided to terminate an employee, initiate the offboarding via Plane. In case you have any specific questions before making a final decision, please reach out to support@plane.com Please respect our timeline to inform us at least 30 days in advance about any involuntary termination (10 days for terminations in Canada).
We ask you to provide answers to the following questions. This will enable us to consult our legal team for the best course of action and timeline.
What is the reason for the termination?
Is the employee a protected class? (sick leave, maternity, paternity, parental leaves, raised issues of bullying etc.)
What is the desired termination date?
How should the notice period be managed? Should the employee work through the notice period or receive pay in lieu of notice?
How many paid time off days has the employee taken? (Any accrued but unused paid time off will be paid out.)
We suggest offering ex-gratia or severance pay in addition to the statutory requirements in exchange for a signed Mutual Termination Agreement. The average is a month's pay. Please provide the amount.
Once we have received the above information, Plane begins the offboarding process on our end.
Plane calculates the final payroll amounts, and our legal team prepares the MTA (Canada: Waiver and Release letter), which is shared with you for review.
With the termination document in hand, you need to inform the employee about your decision to end the employment. Once the conversation is done, inform Plane to send the MTA to the employee for review and signature.
The employee will have time to review the MTA and raise any questions or concerns. You can advise the employee to take the time they need to carefully review the terms of the MTA. If the terms are agreeable, we would appreciate the signed document being returned at their earliest convenience — ideally within 10 days (1 week for terminations in Canada) —to help ensure a smooth administrative process. In some countries, employees may be entitled to involve a lawyer.
If the employee agrees to the terms of the MTA, they sign. If they do not agree, you will need to go into negotiation with the employee with the ultimate goal to have the employee sign. Some employees negotiate e.g. a higher severance amount. In case no agreement is found between you and the employee, in some countries, we need to involve local legal counsel to get to an agreement.
Once the MTA is signed, final payments will be paid out to the employee. Please note that we are not able to arrange the final payment (severance) until the employee has signed the document. However, statutory payouts, such as notice pay and PTO will be paid to the employee in the next available pay period
Although we do not impose/communicate a clear deadline for signing, we would like to highlight that our payroll processing is finalized on the last working day of each month. Agreements signed after this date may result in a delay of the final payment to the following payroll cycle/possible adjustment of the termination date. We provide this information to ensure clarity and to help avoid any unintended delays, and have prepared 3 possible scenarios:
Scenario 1:
MTA signed before payroll cut-off
Final payment is processed smoothly within the current payroll cycle.
All administrative steps are completed without delay.
This is the ideal scenario to help ensure timely closure.
Scenario 2:MTA signed after payroll cut-off
Final payment will be deferred to the next payroll cycle (the following month).
All other steps will be completed, but payment timing is impacted.
In some cases, we might need to move the termination date
Scenario 3:MTA not yet signed/Employee is still considering
Regular salary will continue to be paid until MTA is signed.
Final payment and any related documentation remain pending.
It is customer’s responsibility to come to an agreement with employee to sign MTA
Once the MTA is countersigned, Plane uploads it to the employee’s profile.
Once final payroll has been processed, Plane refunds the security deposit.
Severance
Severance requirements vary by country. For more information, you can review the employment contract and contact us at support@plane.com.
Payout of unused PTO/vacation leave
If an employee accrues unused PTO, they are entitled to either have this benefit paid out or use it before their termination date.
Pay in Lieu of Notice
Many employment contracts outline a notice period: how much time an employer or employee must provide before terminating a work relationship. In some cases, an employee won’t be required to work their notice and may be eligible to receive pay in lieu of notice if the employer or employee wants to terminate the employment relationship immediately.
However, notice periods and eligibility for pay in lieu of notice can vary by country and factors like an employee’s tenure, age, etc. You can review the employment contract and reach out to support@plane.com for more details.
Frequently Asked Questions
Does the employee need to work their full notice period?
If you both agree to it, we may be able to terminate an employment contract without the employee working their full notice and can pay out the notice in lieu.
How do I start the termination process?
It is best to initiate the termination process directly through the Plane platform — as outlined below. Alternatively, if you have specific questions, before making a decision for termination, you can reach out to support@plane.com
Log in to your account on manage.pilot.co, and go to the People tab.
Click on the “Team” tab. Next, click on the “>” next to the employee's information on the right-hand side of the page.
Finally, click on the three purple dots in the top right corner and select “Terminate Employee.”
Our team will then reach out to you to discuss the offboarding process since it can vary depending on the grounds for termination.
What documentation do I need to provide?
You’ll need to provide Plane with information on how much PTO an employee has used. For terminations, we require information about the termination reason, if the employee is a protected class, the desired termination date, the handling of notice period and the amount of severance payment.
In case the termination reason is performance, make sure to have proof of it in the form of (e.g., an improvement plan, records of employee misconduct, written warnings, etc.).
How long does it take to terminate an employee?
For involuntary terminations or dismissals, anywhere from 2 weeks to 3 months. The exact timeline depends on various factors, such as the terms of your employment contract, the laws of the country you’re operating in, and an employee’s tenure. Negotiations initiated by the employee can also lengthen the process.
All employee terminations must be compliant with applicable local labor laws. We try to work as fast as possible within the guidelines of these laws while maintaining compliance.
How do I terminate an employee during probation?
The amount of notice you must give before you terminate an employee on probation depends on the terms of their employment contract. Keep in mind that the dismissal procedure must be fair, and you must give a valid reason for the dismissal. Similarly to the process for an involuntary termination, keep documentation of any performance issues, feedback, or concerns that arise during their probationary period.
Questions?
We’re here to help! You can find more of our guides here, reach out to us at support@plane.com, or use Plane's in-app chat.