This article features strategies on how to effectively go about firing consultant companies. Hiring a consultant can be a challenging process, and at the end of the long road of proposal reviews, interviews, and proof of concepts you find the consulting company just wasn’t able to deliver. The next logical steps for an organization will be to terminate the consultant and look for a replacement service provider. Though it maybe difficult to terminate a service provider, especially if working with past colleagues or friends. But effective removal remains a prudent decision to recuperate loses and to begin moving in the right direction.
Reasons that Result in Firing Consultant Companies
There are often amicable terms in which companies can part ways with a consultant company, but here we focus on when things don’t go so well or changes occur. Here are some reoccurring themes that are commonly encountered when working with traditional professional services:
- Poor Performance – stated goals and objectives were not met, along with contrast in advertised skillset versus what was provided
- Change in company direction – new data and market development can render projects obsolete or contracted services to be no longer required
- Violation of terms of agreement – a non-compete clause may be violated, which means a consultant may end up being a competitor to a client, other times auditing firms may run into the scenario of service as auditor and service provider resulting in a conflict of interest (source)
- Lack of time for guidance – a company may find itself strapped for time and the required investment of guiding consultants may no longer be available
- Requirement for full time staff – companies may often times bring expertise in-house after a function has proven its worth
- Lack of fit with culture – despite having sound technical or business acumen some consultants may simply not contribute to the cultural capital of an organization, where by work is completed but employees are left with a negative experience. Or the consultant could simply be incongruent with your organizational values.
- Financial difficulty – the market may prove soft and your department may require offloading consulting expenses for a time being
- Contract expiry – companies may sometimes decide not to renew a contract after it has elapsed
Steps to Firing Consultant Companies
Having worked as a managing consultant to a network or series of contractors on behalf of clients, here are best practices for firing consultant companies due to the issues above. The most prudent approach is to play by the rules of your service agreement and quickly securing organization assets and security access.
1 – Complying to Terms in your Service Agreement
Prior to start project or contracted work a client and consulting company will often times enter into an agreement.
Consider 30 Days Notice
Organizations should review their contracting arrangements and ensure they aren’t violating terms and pay any outstanding invoices. Common things to consider is providing notice to the vendor in a timely manner. If a contract states that a consultant company should receive a number of days notice this should be followed. For immediate instances where the consultant has to leave and vacate premises organizations will typically pay the remaining invoices and ask consultants to vacate premises. This will mitigate risk of consultants pressing charges against a client in case there are any unpaid invoices .
Follow the Grounds for Termination Clauses
Contracts won’t typically specify when parties in a service agreement can walk out as this is left to discretion of both parties . In the case that there are conditions to a contract organizations must ensure they aren’t violating those terms or clauses. Another way to frame this topic is that there may be conditions to when you can terminate a consultant without facing legal action. Fair termination often includes the following:
- Identifying issues in performance or products provided
- Communicating them and documenting when correspondence was given
- Demonstrate reasonable attempt at remediating these issues
If the consultant hasn’t resolved the identified issues, there is now a strong case for termination.
Maintaining Clear Boundaries to Avoid Litigation of Wrongful Dismissal
A wrongful dismissal may be filed if a contractor or sole proprietor had a employee relationship with your company. The lines begin to blur if consultant serves only your company for the majority of its work, or simply does not have other clients. Another factor that courts use to determine employee versus contractor arrangement is whether a contractor assumes risks or profits from company operations (source). To avoid wrongful dismissal its often helpful to understand and consult an experienced professional.
2 – Securing Company Data and Information
Clients often provide information to consulting companies to deliver their services or products. Here are some common steps to take once a consultant has been served a notification of termination to protect privacy and security of corporate data and information:
- Request all physical documents to be returned
- Request all digital data including including : external drives, Google Drive files, DropBox, and media be returned
- Have consultant company return all binders, folders, and printed materials that were generated as part of the project
- Request all source code, designs, and schematics developed to be handed over to designated company representatives
3 – Restricting Access to Facilities and Systems
Consultants may sometimes be given access to company facilities, digital systems, and other third-party accounts. Check to ensure that the following is done after the firing a consultant companies:
- Have consultant return all ID badges
- Upate and biometric scanners to remove access of consultant
- Request access to all accounts and software systems that are managed by third-parties
- Revoke access to all software systems including: email, time sheet applications, ERP, and custom applications
4 – Recovering Assets
Companies will sometimes provide assets and equipment for consultants to do their work, refer the following list to identify what items will need to be returned
- Laptop and accessories
- Carry bags and device case/accessories
- Hazardous protection: Hardhat, high-res apparel, steel toe boots
- Cell phones and other mobile devices
5 – Steps to Politely Firing a Consultant for Reasons
Depending on the situation a varied approach is required to effectively terminate a consultant. Mindfield offers a supplementary resource to guide leaders in politely terminating consultants due to a number of reasons including:
- Terminating consultant due to poor performance
- Firing consultant due to change in direction
- Terminating consultant due to full-time staff requirement
- Terminating consultant company due to financial restraints
- Firing a consultant due to contract expiry
Courtesy on Timing for Firing Consultant Companies
Difficult news should come as soon as possible but there are certain strategies in the industry that can provide additional tact and professionalism. Ideally termination of contract should be sent to the account manager or project lead when working with a team of consultants. The preferred channels of communication in order of most professional include: face to face meeting, video conference, telephone conference, and written notice.
In terms of best times to provide communication on terminations it is often cordial to avoid days prior to the weekend like Thursday or Friday, which could impact the consultant and their personal time off. The Preference is typically to provide notice early in the week so that there is time to adjust and make plans, allowing the consultant greater peace of mind during the weekend.
Get a Second Opinion on a Project or Consultant Company
Mindfield Consulting has enabling organizations to deliver core business and mission critical technology for two decades. Clients trust us to audit and provide project relief when there are challenges that arise. If uncertain feel free to contact us for a consultation and review of your existing projects to reduce risk and salvage an engagement.
Mindfield Consulting is a technology services provider, trusted by clients for over 19 years, and specializing in custom software development, elearning corporate training, and outsource software development. We work with clients to help them untangle their most complex technology challenges our to create digital platforms for new revenue streams. Midfield creates mission critical technologies for business leaders who desires to lead with technology.