What is the offboarding process in HR?

Offboarding is the structured process that organisations use to manage an employee's departure from the company. It encompasses all the administrative, legal, and procedural steps required to ensure their exit is handled professionally and thoroughly. 

In the HR context, offboarding involves everything from processing final paperwork and retrieving company property to conducting exit interviews and transferring knowledge to remaining team members. It's essentially the mirror image of onboarding. Onboarding welcomes new employees into the organisation whereas offboarding ensures departing staff leave in an organised and compliant manner. If you’re keen to learn more about how onboarding works and take away a checklist to inform your onboarding processes, check out our blog, ‘The Essential Guide to Employee Onboarding Checklists’. 

The process typically includes revoking system access, collecting company assets, finalising pay and benefits, completing legal documentation, and facilitating handovers. We’ll discuss these components later on in this blog. 

Efficient offboarding can significantly impact an organisation's reputation, security, and operational continuity. Offboarding can achieve several functions for the organisation. It protects company security by ensuring revocation of access to systems, premises, and confidential information, preventing potential data breaches or intellectual property issues. The process also maintains business continuity by facilitating proper knowledge transfer and documentation. Disruption in business operations can prove to be costly. 

Additionally, how an organisation handles departures significantly impacts its employer brand. As part of the employee lifecycle, it’s important to consider offboarding in your brand strategy; for a comprehensive guide on creating the right culture and positioning yourself as an employer of choice, download our ‘Employer branding strategy guide’. Professional, respectful offboarding creates positive lasting impressions with former employees, who may become advocates for the company or even return in future roles. For more details, read our blog, ‘How to improve employee advocacy - turning leavers into brand ambassadors’ to understand the value of employee advocacy. The process also provides valuable opportunities to gather feedback through exit interviews, offering insights into workplace culture and areas for improvement. 

As we’ve mentioned, there are several reasons an employee may need to be offboarded. The employee offboarding process can be triggered due to them resigning or retiring, which are voluntary. Termination can also be a reason to trigger offboarding. This might involve disciplinary procedures, performance management processes, or redundancy consultations depending on the circumstances. 

Offboarding is the comprehensive operational process that follows once a departure has been confirmed, regardless of the reason. It encompasses all the practical steps required to transition the employee out of the organisation smoothly and securely. 

Offboarding process for resignation 

Resignation typically provides the most structured timeline, as employees usually give notice periods ranging from one week to several months depending on their role and seniority. This advance notice allows HR teams to plan and execute a thorough offboarding process, ensuring proper handovers and knowledge transfer. 

Offboarding for retiring employees 

Retirement often involves the longest lead times, sometimes planned months or years in advance. This extended timeline allows for comprehensive succession planning, mentoring of replacements, and celebration of the employee's service. However, the core offboarding elements remain the same. 

Offboarding for termination scenarios 

Termination scenarios, including redundancy, dismissal, or contract non-renewal, may require immediate or accelerated offboarding timelines. In these cases, security considerations often take priority, with system access potentially revoked immediately whilst other elements like final pay processing and asset return follow standard procedures.

6 Stakeholders involved in the offboarding process 

Successful offboarding benefits from coordination between multiple departments and stakeholders. Whilst HR teams will lead the way on the process, other teams and personnel will be involved, like the following: 

1. Line managers - Facilitate knowledge transfer, manage final responsibilities, communicate with teams, and arrange temporary coverage. 
2. IT department - Revoke system access, retrieve company devices, transfer data ownership, and ensure cybersecurity protocols are followed. 
3. Finance - Calculate final payments, process expenses, handle benefit transfers, and manage company credit cards and procurement systems. 
4. Facilities management - Coordinate return of physical assets (keys, access cards, vehicles) and arrange clearance of personal belongings. 
5. Legal - Review confidentiality agreements, non-compete clauses, ensure employment law compliance, and handle disputes. 
6. Payroll - Ensure accurate final pay calculations including holiday entitlement, overtime, bonuses, and equipment deductions. 

It can be highly beneficial to structure your offboarding process akin to a checklist. This can help you ensure that the process is consistent throughout every employee offboarding. The following components can form an effective offboarding process. 

1. Documentation and paperwork requirements 

The majority of documentation and paperwork required to effective offboarding is legal and compliance related. All voluntary procedures will include the production of a P45 and tax documentation to speed up the onboarding process for employees in new employment. Depending on the circumstances, it’s possible that you’ll need to put together non-disclosure agreements and confidentiality clauses. Other documentation to sort out could include expense claims, outstanding loan or advance payments, and data protection/GDPR compliance documentation. 

2. Asset return and inventory management 

As an organisation, you’ll often provide all staff with more than just laptops, tablets, and mobile phones. Employees may also need to return office keys, access cards and security fobs. If you have a mobile sales force, they’ll need to return the company vehicle and relevant fuel cards. Depending on agreements, employees may need to return protective equipment. Company credit cards, client files, confidential documents, software licences and subscriptions all need to be returned and treated with the correct security protocols as they could lead to a leak of sensitive information. 

3. Access revocation and security protocols 

Access revocation will be dealt with mostly by your IT department as they can deactivate the single sign-on account for a departing employee across the whole suite. They’ll also be able to set up email forwarding, remove network and VPN access, remove access to cloud storage, multi-factor authentication device removal, and third-party access systems. Depending on your company policy, you’ll need to consider a timeline for revocation. For example, benefits and pay should remain accessible in a restricted view for the former employee to review. PeopleXD Evo has permission-based access to these integrated features to ensure that employees can keep track of their pay and benefits. It’s also possible to allow employees to continue to access learning platforms, which can help promote employee advocacy. For more tips on how to improve employee advocacy, read our blog, ‘How to improve employee advocacy - turning leavers into brand ambassadors’. 

4. Knowledge transfer procedures 

Employees provide incredible value within your organisation. Whilst it’s impossible to keep all of them, retaining the information and knowledge they possess can be extremely beneficial to business continuity and success. The offboarding process can put handover documentation in place, which can include the following: 

• Client relationship mapping and introductions 
• Project status updates and next steps 
• Password and login credential transfers 
• Supplier and vendor relationship handovers 
• Meeting notes and decision rationales 
• Training replacement staff or colleagues 
• Creating process documentation and standard operating procedures 

The CIPD notes that ‘The average turnover - or churn - for UK workers is 34%. This splits into 27.4% who move to a new employer and 6.6% who are not working one year later (year 2), which could be due to study, retirement or long-term sickness.’ This presents a significant knowledge loss in organisations which can be alleviated with effective offboarding processes. 

5. Final compensation and benefits processing 

Getting final pay calculations right helps maintain trust and can prevent potential disputes down the line. You'll typically calculate the departing employee's final salary, including any pay in lieu of notice if they're leaving immediately. Many employees have accrued holiday pay that gets paid out according to their contract terms. If your organisation operates bonus schemes or commission structures, these final payments can become quite complex, particularly when they're tied to annual performance cycles or client retention rates. 

Pension scheme considerations often require some coordination, as employees may want to transfer their contributions or understand their options for maintaining coverage. If your organisation offers share schemes or equity options, these often have specific departure rules worth explaining clearly. For redundancy situations, statutory or enhanced redundancy calculations benefit from being accurate and well-documented to maintain compliance with employment law. 

6. Exit interview 

The exit interview represents a valuable opportunity to gather honest feedback about your organisation, though it works best when handled thoughtfully to encourage openness. You can offer different formats. Some employees prefer face-to-face conversations with HR, whilst others feel more comfortable with anonymous written surveys or video calls. The key lies in asking questions that go beyond surface-level satisfaction ratings. Consider focusing on understanding what drove their decision to leave, how they perceived management effectiveness, and whether they felt supported in their role development. For examples of exit interview questions, read our blog ‘15 exit interview questions for successful offboarding - with free template’. 

It's worth expanding the conversation beyond problems. Consider asking about what the organisation does well and what they'd recommend to colleagues considering similar roles. Depending on their experiences, they may be willing to become part of an employee advocacy scheme; you can read more about them in our blog, ‘How to improve employee advocacy - turning leavers into brand ambassadors’. This balanced approach often yields more actionable insights than purely focusing on negatives. The feedback you gather can feed into broader retention strategies and organisational improvements. Departing employees are often more willing to share candid feedback than current staff, making this process valuable for identifying blind spots in your workplace culture and management practices. 

A smooth offboarding process can provide several advantages and benefits for your organisation, extending beyond administrative and legal compliance. Employee departures can then strengthen your business, rather than being periods of disruption and risk. 

Risk mitigation and security protection 

Former employees who retain system access, company devices, or confidential information can inadvertently or deliberately compromise your data security. A structured approach to revoking access across all platforms, from email accounts to client databases, significantly reduces these exposure risks. Physical security considerations also come into play, particularly with office keys, access cards, and company vehicles. 

Knowledge preservation and transfer 

Departing employees often take with them years of accumulated knowledge, client relationships, and institutional understanding that can be difficult to replace. A structured offboarding process creates opportunities to capture and transfer this knowledge before it walks out the door. This might involve documenting processes, introducing key clients to new contacts, or training colleagues on specific procedures. 

The impact becomes particularly significant with senior employees or those in specialist roles where replacement recruitment can take months. Learning curves when you have to start from scratch can be expensive! 

Maintaining positive employer brand 

How you treat departing employees often reflects your organisational values more clearly than your marketing materials. Whilst building the employee brand initially is important, maintaining with existing and departing staff can be even more impactful; to see how you can build your employee brand, download our ‘Employer branding strategy guide’. Former employees frequently become informal ambassadors for your company, sharing their experiences with professional networks, potential candidates, and industry contacts. A respectful, professional offboarding experience can turn departing staff into advocates rather than critics. For more tips on how to improve employee advocacy, read our blog, ‘How to improve employee advocacy - turning leavers into brand ambassadors’. 

Workplace experiences get shared on employer review sites like Glassdoor, social media, and professional forums. Positive departure experiences can enhance your ability to attract talent, whilst negative ones can damage recruitment efforts for years to come. Recruits will look at the likes of Glassdoor to get a sense of the organisation. 

Legal compliance 

Having clear processes and documentation can protect your organisation from potential disputes or regulatory issues. The documentation created during offboarding also serves as valuable evidence if questions arise later about the departure circumstances, final payments, or asset returns. This becomes particularly important in cases involving redundancy, disciplinary actions, or employees in regulated industries where specific procedures might be legally mandated. 

Cost saving and efficiency improvements 

Whilst offboarding requires upfront investment in time and resources, it often delivers significant cost savings over the longer term. Recovered assets like laptops, software licences, and company vehicles can be reallocated rather than replaced. Proper knowledge transfer reduces the training time and productivity losses typically associated with replacement employees. Perhaps most importantly, your team won’t be scrambling around to figure out what to do when someone hands in their notice. With a structured offboarding process in place, you’ll be able to provide all the knowledge of the departing employee to the department. 

Implementing this process manually can be time consuming. Modern HR technology can transform how organisations handle employee departures, turning complex multi-step procedures into streamlined, automated workflows that reduce administrative burden whilst maintaining consistency across all departures. 

PeopleXD Evo offers an end-to-end, AI-enabled HR Software solution that can significantly simplify your offboarding processes. Rather than juggling spreadsheets and manual checklists, you can create automated workflows that maintain one source of truth for HR data, enabling all stakeholders, from IT teams tracking devices to finance teams calculating final pay, to access the information they need from the same platform. With features like Copilot, the AI-powered HR Assistant, your team can get instant answers to HR queries and automate routine tasks, allowing you to focus on the strategic aspects of offboarding like meaningful exit interviews and knowledge transfer rather than getting bogged down in administrative complexity.