Dealing With Disgruntled Former Employees

Oct. 2, 2013
Eventually every employer experiences a disgruntled former employee spreading poison.  How will you handle it when it happens, (because it will)?

The Devil

A friend of mine, who is one of the industry’s most highly respected and successful contractors of all time, was publicly defamed on an Internet slam site.  He was called a “phone buff, pompas, (sic) arrogant, street angel - closed doors devil.” 

Wow.  But that was just the start.  The former employee added, “This Executive is afflicted with accute (sic) narcissism, a pronounce inclination toward moral insanity, utter lack of empathy for our clients, management, staff or professional tradesman.”

That’s mild compared to the charges leveled by the former employee at the rest of the management team.  One manager was called a “pathalogical lier (sic) who has personal tax issues and has to live in Tijuana Mexico. This looser (sic) would sell his mother out for commission or a bonus.”

Not Everyone Wants to be Held Accountable

The substance of the employee’s complaints were centered on raising prices, setting goals, holding people accountable, and dismissing those who didn’t measure up.  In short, he made money and was probably a tough guy to work for if you didn’t perform at a high level.  If you don’t like it, change jobs.  It’s not complicated.

When it’s about you, it’s hard to read or hear this stuff.  It hurts.  You worry about what others will think. 

After all, people love rumors.  Some will gladly share the malice.  Those jealous of another’s success will always find joy in the personal destruction of achievers as a means of excusing their own shortcomings. 


From a legal standpoint, there’s little a boss can do.  Free speech is protected.  Opinions are one’s own.  So it’s relatively hard to prove slander or defamation.  Even if you prove it, you can lose by winning.  First, the damages are unlikely to be significant while your legal costs will be. 

Second, you waste time and lose focus on your business.  This may be the greatest financial cost.  You’re fertilizing negative energy.

Finally, you call more attention to the slander or defamation than it would merit on its own.  More people learn about it.  Some wonder why you’re fighting so hard if there’s nothing to it.  You see, no one cares as much about as you do.  Most people tend to dismiss the ravings of a disgruntled employee until you do not.

Reach Out and Let Go

If you have trouble getting past the poisonous lucre of an ex-employee, reach out directly or through a third party to see if the situation can be resolved.  If not, let it go.  Move on.  You will be surprised how easily other people dismiss the criticism when you brush it off first.

Separation Agreements

If you want to prevent slander, offer employees a separation agreement on termination.  In this agreement you offer something meaningful to the employee (i.e., a better separation package).  In return, the employee agrees to certain actions (e.g., non-compete, non-disclosure, etc.), including what can be said about you, your management team, and your company. 

Of course, an employee may choose to forego your package, so you’re back to square one.  The employee may even sign without shutting up, and force you to prove slander.  Again, this is tough to do and, as noted above, not usually worth the effort.

No One Hates a Failure

Sadly, anyone who performs well in business will eventually accumulate detractors.  You can no more change this than you can change human nature.  If possible, draw satisfaction from the knowledge that people may pity a failure, but no one hates a failure.

Matt Michel is CEO of the Service Roundtable, which helps contractors improve their sales, business, and financial performance.  Watch this short video, entitled “Sam is a Contractor – Sam has a Secret” to learn more.  Call 877.262.3341 for a free copy of the Service Roundtable’s “Profit Report.”

About the Author

Matt Michel | Chief Executive Officer

Matt Michel was a co-founder and CEO of the Service Roundtable ( The Service Roundtable is an organization founded to help contractors improve their sales, marketing, operations, and profitability. The Service Nation Alliance is a part of this overall organization. Matt was inducted into the Contracting Business HVAC Hall of Fame in 2015. He is now an author and rancher.