If an employee has done something that qualifies as a for-cause firing, they go, no matter how much revenue they carry or how much capacity you lose the day they walk out. A for-cause violation isn’t a performance problem you can coach through, and keeping someone after one tells the rest of your team what your policies are actually worth.
What does firing an employee for cause actually mean?
For cause means the person violated company policy, not that they underperformed. Forging expenses, logging hours they never worked, lying about deadlines, leaking proprietary information to a competitor, getting a DUI in the company car. Those are different in kind from someone who is slow, disorganized, or in over their head.
That distinction is the whole decision. Correctable problems get a performance improvement plan, a written warning, coaching, and a real chance to fix it. That’s what those tools are for, and they work more often than owners expect. A for-cause violation isn’t on that list. If you’re calling it for cause in your own head, you’ve already answered the question, and the only thing left is how fast you move and how cleanly you document it. Talk to your attorney before you act, because the paperwork matters as much as the decision.
Should you keep a top performer who violated policy?
No, and the size of their book of business doesn’t change the answer. The objections all sound the same. They have the biggest account. They bring in the most revenue. It only happened one time. That last one is worth sitting with, because “they only stole once” isn’t how stealing works, and everyone else in the building understands that even if you’re trying not to.
Here’s the part that costs you later. The moment one person keeps their job after a real violation, the policy stops meaning anything. Every future conversation about standards gets harder, and every person watching learns what the rules are actually worth. You’re not deciding about one employee. You’re setting the price of breaking the rules, and everybody is taking notes.
How do you protect your capacity before you lose it?
The business side of this is brutal and worth planning for, because losing two well-paid people at once takes real capacity with it. The protection is access to capital: a line of credit you can draw on, savings in the bank, something that turns a crisis into a choice.
Capital buys options. With cash available you can bring in a subcontractor this week, or you can finally go after the person you’ve wanted to hire but thought you couldn’t afford. That second move solves two problems at once, because you replace the capacity and you up-level the team at the same time. Without capital, you take whoever is available at whatever they cost. And this isn’t only a personnel plan. Your biggest client might not renew either. Every business has valleys, and capital is what you cross them on.
Why should you never stop recruiting?
Because you never know when someone walks, and that’s true even when your roster is full. People jump jobs faster than they used to. So you keep meeting people, keep building relationships with the ones who could work out, and you always know who you’d call. If that feels disloyal to the people you have, reframe it. You’re not shopping for replacements. You’re thinking about the next opportunity you get to give someone.
This is also the moment your network pays you back. You’ve been going to things, meeting owners, building real relationships. When two people leave at once, that’s when you call your business best friend, tell them you have no idea what you’re going to do, and ask who they know. That’s the entire reason to network in the first place. Owners who’ve done that work get names, referrals, and a subcontractor by Friday. Owners who haven’t get a job posting and a long wait.
Questions owners ask
What counts as a for-cause firing?
A violation of company policy rather than a performance shortfall. Theft, falsified records, lying about work completed, leaking confidential information, or misconduct with company property.
Can I put a for-cause violation on a performance improvement plan instead?
Performance plans are for correctable problems. A policy violation is a different category, and treating it like a coaching issue signals that the policy is negotiable.
Should I talk to a lawyer before I fire someone for cause?
Yes. Employment law varies by state and the documentation matters. Getting the process right protects the business as much as the decision does.
What if I can’t cover the work after they leave?
Reach for capital and your network the same week. A line of credit, a subcontractor, and three phone calls to owners you trust will move faster than a job posting.
Here’s the homework. Answer one question honestly: if you lost your two most productive people tomorrow morning, what would you actually do by Friday? If you don’t have an answer, that’s your project this month, and it starts with a line of credit and three phone calls. Watch the full episode for the whole conversation.
Related
- The Un-Fun Part of Owning a Business: Firing an Employee!
- Training problem or wrong hire? How to tell the difference
- How many clients can you actually take on?
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