Knowing how to fire a contractor is an art form. It takes planning, tact and a keen assessment of the situation. Let's face it, no one wants to fire anyone.
But if you've ever watched a project fall behind because one of your contractors couldn't keep up or was in learn-as-you-go mode, you know that firing a contractor is one of the most stressful parts of managing a business.
In this article we hope to give you a framework for firing a contractor and some helpful hints to make the process as smooth and conflict-free as possible.
Knowing how to fire a contractor all starts with the right level of preparedness. Below are a few precautionary steps you can take even before you start working with a new contractor.
We aren't lawyers nor do we play them on TV, so please seek your professional legal council when drawing up the agreements that pertain to you and your business. The agreements you have with your contractors are the first place you can tighten up to make firing a contractor easier.
Your contracts should explicitly include language that states you have the right to terminate the contract and agreement for any reason and at any time. This agreement clause is helpful when you're trying out a new contractor and you may need to let them go quickly.
Add a "work for hire" line into your agreement for any intellectual work so that the creator of that work can't claim ownership of the content after they leave.
Vetting Your Contractors
How does that saying go? "An ounce of prevention is worth a pound of cure".
The same is true for hiring contractors. Finding good people to contract work out to will save you the hassle of having to fire them later. Even when you're busy and struggling to meet deadline, check their references and mentally scrutinize their work. Technically this isn't exactly in the scope of how to fire a contractor, but it's certainly a good way to avoid having to fire them.
Keeping a Stable
Having a stable of contractors on deck is a business savvy way to keep things running smooth. A contractor's not making the grade? Switch them out for one of your trusted contractors. The key to making this work is to build trusted relationships with your contractors that rock.
Did they really kick butt on that last project? Send them a bonus. Is it their birthday? Send them a gift. This is where constant communication with your "stable" is crucial. It also means you need a simple, easy to use resource planning tool (ahem) to organize which contractors are available.
Monitoring Your Contractors
Constant communication is the key to keeping a good relationship with your contractors.
When you're working several active projects, its key to have daily contact with your contractors. A daily check-in meeting is a great way to see how a project is progressing and one of the best ways you can foresee problems arising before they get worse. You can use services like Hipchat or Skype to get updates throughout the day.
Observe how your contractor acts, too. Are they constantly late to meetings? Are they always missing milestone dates? They may need more motivation for you or they may need to be let go. There isn't any way to sugarcoat it. Some people just don't take contract work seriously. They see a paycheck and they just want to get to the finish line. If you get that vibe from them, let them go before it really hurts your business.
How To Fire
This is the easiest and the most uncomfortable part of the process. One thing to note before you fire your contractor: keep detailed records of the systems, services and tools that your contractors have access to.
You should have the ability to control any account they have access to. The last thing you want is for your freshly fired contractor to take revenge.
When dealing with a new contractor it may be a good idea to have weekly (or even daily) file check-ins where they submit their latest work into you. That way if you have to fire them you have their latest draft of the project.
Tips for the firing
- Be calm and friendly, remember it's just business.
- Be short and to the point with why you're firing them. You don't need to get into great detail or insult them. If they wasted too much money, it might be your fault for waiting too long to recognize the problem.
- With contractors you may want to explain to them that this project didn't best fit their skillset, but future ones might.
- If they reach for external excuses, explain to them that you've already made up your mind.
- Explain how much they'll be paid based on the work they have already performed (another reminder to keep good records and log hours weekly!)
- Keep a record of why you fired someone and look for warning signs in the future.
Firing someone sucks. Being prepared and organized can make the process less stressful and help you spot problem contractors earlier. Do you have a contractor horror story? We'd love to hear about it.