Dr. Paul Borosky, DBA, MBA
Business Plan Writer & Financial Projections
How Do You Fire an Employee Fairly in a Small Business?
How You Let Someone Go Is Watched by Everyone Who Stays.
Something goes wrong, you are angry, and you fire someone on the spot in front of customers. A few days later you learn it was not their fault, and two customers have quietly cancelled. This guide lays out how to end a job fairly: checked, private, and respectful. It is the same approach business consultant Dr. Paul Borosky, DBA, MBA, uses with clients.
Last Updated: 11/08/2026 · Written by Dr. Paul Borosky, DBA, MBA
The Definition
What Does Firing an Employee Fairly Mean?
Short Answer
Termination is ending a person’s employment. Done fairly, it is rare, based on checked facts, and handled privately and respectfully. Performance problems usually go through warnings and an improvement plan first. Serious misconduct is handled differently but still requires checking the facts and hearing from the employee before deciding. Final pay, returned property, and written confirmation complete the process.
Fair termination = conduct or performance? + facts checked + fair warning + private and short + final pay and keys
Doctor Owl, in Plain English
“You fired him in front of the whole dock for a round you never told him had moved. Check the facts first. Then, if it must end, end it privately.”
How This Guide Works
Need the answer fast? Read the Short Answer above and the numbered steps. Want the full picture? Follow Sheldon, a crab who runs a security and lock business with his twin from Dr. Paul’s Fabled Forest Business School Series, as he fires a night guard on the spot in front of customers. His story shows up in a few short gold notes along the way. The math sits in one section, clearly marked.
Facing a Termination You Want to Handle Right?
Talk it through with Dr. Paul before you act, set up fair policies, or learn the steps first.
Business Consulting
FeaturedFor owners stuck on hiring, pay, or a team that keeps turning over. Dr. Paul helps you set the roles, the pay, and the rules.
See consulting options →Business Plan Writing
When a lender or investor needs it, Dr. Paul writes the plan, including the management and staffing sections lenders read closely.
Start your plan →Business Plan Templates
An industry Word plan and Excel model with the staffing and payroll lines already built in.
Browse templates →Small Business Education
Free guides, videos, and the Fabled Forest Business School books on hiring, training, pay, and keeping good people.
Start learning →From Dr. Paul’s Fabled Forest
Meet Sheldon: Keys on the Counter
Some lessons stick better as a story. Dr. Paul’s Fabled Forest Business School Series teaches business through a forest full of small business owners. Doctor Owl, a dry-witted consultant who lives in the Lone Oak, helps them fix the same problems real owners face.
Today he is waiting for a new library lock at Hard to Shell, a lock and night-guard business run by crab twins, Sheldon and Percy. A young gull who guards the coast boathouses at night walks in, and Sheldon tells him to put his keys on the counter and not come back. He does, while customers and half the dock look on. A boathouse round had been missed.
Why It Matters
What Makes the Way You Fire Someone Matter So Much?
Firing in anger feels decisive. It is also how owners make the most expensive mistakes: acting on incomplete facts, doing it publicly, and skipping steps that protect both sides.
Everyone who stays is watching. So are customers. A public, unfair firing tells the team their jobs depend on the owner’s mood, and tells customers the business is chaotic. Termination done right protects the employee’s dignity, the team’s trust, and the business.
In the Fabled Forest
By Friday, two boathouse accounts had cancelled, eight coins a month each. Then Percy put Monday’s round sheet on the counter. He had moved the gull’s round from two o’clock to three at a customer’s request, and changed it on the sheet, but had never told the gull, or his brother.
The Five Checks
What Should You Check Before Firing an Employee?
- Conduct or performance? Breaking a rule or duty of the job is conduct. Not doing the job well enough is performance, which usually needs a plan first.
- Are the facts checked? Ask everyone involved, check the records, and hear from the employee before deciding.
- Was there a fair warning? For most issues, a written warning should come first. Follow your handbook.
- If it must end, is it private and short? No customers, no crew. The reason stated plainly. No speeches.
- Is it done properly? Final pay on time, property and keys returned, written confirmation, and local rules followed.
In the Fabled Forest
Doctor Owl sat with the twins on three upturned crates in the back of the shop and went through the questions one at a time. The gull had not broken any rule. The round had been moved without telling him. The firing failed every check.
Doing It Right
How Do You Fire an Employee the Right Way?
If you got it wrong, fix it in person and quickly. Apologize, offer to undo it, and tell the team what happened. If the decision stands after the facts are checked, do it privately, in a few minutes, with the reason stated plainly, final pay ready, and property collected.
Then look at the system. Many terminations trace back to unclear schedules, missing communication, or rules nobody wrote down. Fixing those prevents the next one.
In the Fabled Forest
Sheldon tracked the gull down at his family’s home on the dunes and apologized at the gate in person. One of the two cancelled accounts came back the next week with a note thanking them. Months later, when an older guard was found inside a client’s boathouse at two in the morning, the twins checked every fact, heard from him privately, and ended it in five minutes behind a closed door, with final pay in full.
The Numbers
What Did Firing in Anger Cost?
Here is the cost of the public firing, and what a fair process recovered.
| Result | |
|---|---|
| Accounts cancelled that week | 2, at 8 coins a month each |
| Monthly revenue lost | 16 coins |
| Cause of the missed round | Schedule changed without telling the guard |
| Accounts back after the apology | 1 of 2 |
| Time for the later, fair termination | 5 minutes, private, final pay in full |
Step 1: The immediate loss. 2 accounts × 8 coins = 16 a month, or about 192 a year, for a small business.
Step 2: The real cause. A schedule change nobody passed on. The person fired had done nothing wrong.
Step 3: Your version. Before any termination, ask the five checks. Five minutes of checking can save a customer, a reputation, and a good employee.
Illustrative numbers in forest coins, from the book. This is not legal advice; employment rules vary by location.
Step by Step
How Do You Handle a Termination Step by Step?
Four steps before, during, and after.
Pause and check the facts.
Ask everyone involved, check records, and hear from the employee.
Decide: conduct or performance.
Performance usually means a warning and a plan first. Serious conduct may not.
If it must end, keep it private and short.
State the reason plainly, have final pay ready, collect property.
Fix the system behind it.
Schedules, communication, and written rules. Prevent the next one.
In the Fabled Forest
Doctor Owl’s scroll for the twins boiled it down to a few verbs in order: check, hear, warn, and only then decide, quietly.
The Twins’ Full Story
Did the Gull Come Back?
This page gives you the short version. The book gives you the whole week: a heavy ring of keys dropped on a counter, a shop split in half down the middle, two cancellation letters, a round sheet with a crossed-out number, a walk to the dunes, and a harder case in September handled the right way.
Every chapter of Human Resources for Small Businesses works the same way. One owner, one problem, one real idea you can use on Monday, plus a one-page worksheet to do it.
A Business Consultant’s View
What Does Dr. Paul Document Before a Termination?
Dr. Paul Borosky, DBA, MBA · Business Consultant
Before a termination, Dr. Paul has the owner write down four things: the specific reason, the facts that support it and who confirmed them, what warnings were given and when, and the employee’s own account. If any of those is missing, the termination is not ready. He also recommends checking local employment rules and, for anything unusual, talking to an employment attorney, because final pay timing and documentation requirements vary. Most owners who fire in anger regret it, and many end up rehiring, paying more, or losing customers. A short, checked, private process is not softer. It is more professional, and the team trusts the owner more afterward.
FAQ
Still Have Questions About Letting Someone Go?
How do you fire an employee fairly in a small business?
Should I fire an employee on the spot?
What should I do after firing someone?
Keep Going
Want to Go Deeper on Fair Treatment at Work?
This is foundation 15 of 20. These pages build on it. New to a term on this page? Every one is in the human resources glossary.
Written by Dr. Paul Borosky, DBA, MBA, business consultant and author with 14+ years of experience and 1,000+ clients served. Hiring, paying, or managing a team and want a second set of eyes? See business consulting and prices.
This page is for general educational purposes only. It is not legal, financial, employment, or other professional advice. Figures are illustrations. The Fabled Forest and its characters are fictional. For decisions about your own business, consult a qualified professional.