Employee offboarding handbook: Complete guide

An employee just handed in their two-week notice. Now what? Do you scramble to figure out who gets their projects? Wonder if they have access to sensitive data? Hope someone remembers to collect their laptop?

This is what happens when companies don't document their offboarding process. Employee departures become chaotic, knowledge walks out the door, security becomes an afterthought, and HR spends hours reinventing the wheel for every exit.

Your employee handbook needs a comprehensive offboarding section — not just for smooth transitions, but to protect your company legally, preserve institutional knowledge, and maintain security. Let's build one.

Why employee offboarding should be in your handbook

Offboarding is often the most overlooked part of the employee lifecycle. Companies invest heavily in recruiting and onboarding, then fumble the exit. But a poorly handled departure can cause lasting damage.

1. Protect your company from security risks

Every departing employee has access to company systems, data, and possibly client information. Without a documented process, things slip through the cracks.

The risk: A 2023 study by Beyond Identity found that 83% of employees admitted they still had access to accounts from their previous employer after leaving. That's not just a policy failure — it's a massive security vulnerability.

• Active login credentials after departure
• Access to customer data, financial systems, or proprietary information
• Unreturned devices with company data
• Cloud storage accounts with sensitive files

A documented offboarding process ensures IT knows exactly when to revoke access, what accounts to disable, and what equipment to collect.

2. Preserve institutional knowledge

When employees leave, they take knowledge with them — processes, client relationships, undocumented workflows, and context that took years to build.

The cost: Research by Panopto estimates that Fortune 500 companies lose $31.5 billion annually due to knowledge loss from departing employees. For smaller companies, the impact per person is even more significant.

Your offboarding section should include mandatory knowledge transfer procedures. When it's documented in the handbook, it's not optional — it's expected.

3. Ensure legal compliance

From final paychecks to COBRA notifications, there are legal requirements that must be met when an employee leaves. Missing these can result in penalties, lawsuits, or regulatory issues.

4. Maintain positive relationships

How you treat departing employees matters. They become alumni, potential boomerang hires, referral sources, and sometimes even customers. They also leave reviews on Glassdoor.

The opportunity: A positive offboarding experience increases the likelihood that employees recommend your company by 2.9x (Work Institute). Bad exits create bad reviews and bad word-of-mouth.

5. Create consistency across all departures

Without documented procedures, each manager handles exits differently. Some do exit interviews; some don't. Some ensure proper handoffs; others let projects die. This inconsistency is both inefficient and risky.

When offboarding is in your handbook, everyone follows the same process — regardless of department, seniority, or relationship with the departing employee.

What to include in your offboarding section

Your offboarding section should cover the entire exit process — from the moment someone gives notice to their final day and beyond. Here's what to include:

1. Types of separation

Different types of departures require different processes. Clarify how each is handled:

• Voluntary resignation: Employee chooses to leave
• Involuntary termination: Company initiates separation
• Layoff/reduction in force: Position elimination
• Retirement: End of career departure
• End of contract: For contractors or temporary employees

2. Notice period expectations

What's expected when someone resigns?

• Standard notice period (typically 2 weeks; may be longer for senior roles)
• How to submit a resignation (written notice to manager and HR)
• What happens if someone doesn't give notice
• Whether the company ever asks employees to leave before the notice period ends

3. Exit checklist and timeline

Document the step-by-step process from resignation to final day:

• Immediate actions (notify HR, announce to team)
• First week tasks (knowledge transfer planning, project handoff)
• Final week tasks (return equipment, exit interview, final paperwork)
• Last day actions (access revocation, farewell, final check collection)

4. Knowledge transfer requirements

How should departing employees transfer their knowledge?

• Documentation of current projects and status
• Handoff of ongoing responsibilities
• Training of replacement (if hired before departure)
• Contact lists and relationship transitions
• Password and account handoffs

5. Equipment and access return

What must employees return, and when?

• Laptops, phones, and other devices
• Keys, badges, and access cards
• Company credit cards
• Files, documents, and work materials
• Procedure for remote employees

6. Final pay and benefits

Explain what employees can expect financially:

• When they'll receive their final paycheck
• How unused PTO is handled (paid out or forfeited)
• COBRA and health insurance continuation options
• 401(k) and retirement plan options
• Any severance pay eligibility (if applicable)

7. Exit interview process

Explain your exit interview policy:

• Who conducts exit interviews
• Whether they're mandatory or optional
• What topics are covered
• How feedback is used

8. Post-employment obligations

Remind employees of any continuing obligations:

• Confidentiality and NDA requirements
• Non-compete agreements (if applicable and enforceable)
• Non-solicitation provisions
• Return of intellectual property

Sample policy: Resignation procedures

Here's an example of a clear, professional resignation policy:

Sample policy: Knowledge transfer

Here's an example knowledge transfer policy:

Sample policy: Exit interviews

Here's how to document your exit interview policy:

Sample policy: Final day checklist

Here's a comprehensive final day checklist policy:

Common offboarding mistakes to avoid

Avoid these pitfalls when documenting and executing offboarding:

1. Waiting until the last minute

The mistake: Starting offboarding tasks on the employee's final day.

The fix: Document a timeline that starts immediately after resignation. Knowledge transfer takes time — don't compress it into 48 hours.

2. Forgetting remote employees

The mistake: Your offboarding process only works for in-office employees.

The fix: Include procedures for shipping equipment back, remote access revocation, and virtual exit interviews. Remote offboarding needs its own checklist.

3. Not revoking access immediately

The mistake: Former employees still have active logins days or weeks after leaving.

The fix: Coordinate with IT so that access is revoked on the employee's last day (or the moment they're terminated, for involuntary exits). Document this in your policy with specific timelines.

4. Skipping exit interviews

The mistake: Treating exit interviews as optional or not conducting them at all.

The fix: Make exit interviews a standard part of offboarding. You're missing valuable feedback about why people leave and how to improve retention.

5. Not documenting knowledge before it's too late

The mistake: The employee leaves, and no one knows how to do their job.

The fix: Make knowledge documentation a mandatory part of offboarding, starting in the first week of the notice period. Don't wait until day 13 of a 14-day notice.

6. Treating all departures the same

The mistake: Using the same process for resignations, terminations, and layoffs.

The fix: Document different procedures for different types of separations. Involuntary terminations require immediate access revocation; voluntary resignations allow for longer transitions.

7. Burning bridges

The mistake: Treating departing employees poorly, especially if they're leaving for a competitor.

The fix: Always exit professionally. Today's departing employee could be tomorrow's client, referral source, or boomerang hire. Your offboarding section should emphasize respect and professionalism.

For more common handbook mistakes, read our guide on 7 employee handbook mistakes to avoid.

How to implement your offboarding policies

Writing the policy is step one. Here's how to make it work in practice:

Step 1: Audit your current offboarding process

Interview managers and HR: What actually happens when someone leaves? What falls through the cracks? What's inconsistent? Document the reality before writing the ideal.

Step 2: Create your offboarding checklist

Build a comprehensive checklist covering every step from resignation to post-departure. Include who's responsible for each item and when it should be completed.

Step 3: Coordinate with IT and Security

Your offboarding policy must align with IT's access management processes. Meet with IT to establish:

• When and how access is revoked
• Procedure for equipment return (especially for remote employees)
• How long emails are forwarded and to whom
• Data backup and transfer procedures

Step 4: Add it to your handbook prominently

Place your offboarding section in your Employment Policies section, alongside termination and resignation information. Make it easy to find.

Step 5: Train managers on the process

Managers are often caught off guard by resignations. Make sure they know:

• How to respond professionally when someone resigns
• Who to notify immediately (HR, IT)
• Their responsibilities for knowledge transfer
• How to communicate departures to the team

Step 6: Create templates

Don't make managers reinvent the wheel. Create templates for:

• Transition planning documents
• Knowledge transfer checklists
• Team announcement emails
• Exit interview questionnaires

Step 7: Review and iterate

After each departure, do a quick review: What went well? What was missed? Use this feedback to continuously improve your offboarding process.

Final thoughts: Exit as professionally as you hire

The way you handle employee departures says as much about your company as how you hire. A chaotic, inconsistent offboarding process signals dysfunction. A smooth, professional exit signals maturity and respect.

Your offboarding section doesn't need to be complicated, but it does need to exist. Document the basics, coordinate with IT, train your managers, and treat every departure as an opportunity to leave a positive last impression.

Every employee will eventually leave — whether after 6 months or 20 years. When they do, you want the exit to be as smooth as their onboarding. A documented offboarding process makes that possible.

The best time to create your offboarding policy was before your last employee left. The second best time is right now.