I had to fire/let go of an employee yesterday, the first time I've ever had to do that as the big man in charge. I did it once before when I was a manager at Hollywood Video, but this is the first time doing it for myself. It was definitely a new experience. Fortunately, it wasn't for theft or anything that was potentially crippling of the business venture.
I'm pretty proud of the way that I handled it though. I've been reading the book, "Axiom," by Bill Hybels, and one of the things he suggested doing whenever issues with employees arise is to "sit them down" and ask them to "help you understand." So I did that, I asked the employee to help me understand what the issue was that was keeping him from doing his 100%. It turns out the issues were mainly home-based and that he was having a hard time handling work load, so I asked him to take a week off to get things squared away at home, and then come back ready to work. That seemed to work great! He came back stronger than ever; however after a few days his work pace quickly came to a halt. On 3 separate occasions he set deadlines for himself to complete his work, and on each occasion, he missed it. Normally, I would have tried to stick it out with the guy, because he was a genuinely good guy, but his missed work schedule had cost me over $1000 in earnings. It was time to let him go, and find someone that could quickly pick up the slack.
Fortunately I was able to find a new employee within a day. I guess the thing that I learned from this experience is that it is very important to ask your employees to "help you to understand" what may be causing the misstep or delay, and offer them a solution or chance to rectify the situation. In the end, however, it may come down to simply asking them to give up their position if they are unable to fulfill the duties or responsibilies.