Firing people + managing parental leave, with HR expert Lexi Kantor

Hi, I'm Jay Goldstein. I'm the CEO and founder of Founder2Leader, an executive coaching firm that specializes in equipping early stage bio and climate tech leaders for scale. This podcast, From Founder to Leader, aims to demystify what it actually looks like to build hard tech startups. Too often founders share their stories when there are newsworthy successes, the big raises and the lucrative exits. We want you to hear the real human stories that drive innovation, the crossroads decisions, the messy middle and the practical know how. We hope that these conversations will help you as you take your ideas out of the lab and build scalable solutions to improve human health and our planet. Welcome to another episode of From Founder to Leader, the human stories behind Bio and climate tech Startups. In this podcast episode, we are demystifying what it looks like to build a hard tech startup from the ground up by sharing the real human stories behind the headlines from the people driving innovation. In today's episode, we'll be talking with Lexi Kantor, who is currently the head of People at Matrix Space. Lexi, thank you so much for joining us. Thanks for having me. I'm so excited to be here. Lexi, we're going to talk about your background a little bit, but one of the big reasons of why I wanted to invite you to this podcast because I'm always sending my clients to you for help with a couple of very clear human resource challenges. One is firing people. It's always a big stressful thing for new founders to know how to do that and the other is to talk about what to do about parental leave. Often teams are struggling with those two things. So let's start first with a little bit about you and your background. Yes. So I like to say that I grew up in startups. I graduated from Babson College with an undergrad degree in business and was really lucky to be hired into a startup as their first HR person. So I sort of got thrown into the deep end and had to figure it out and you know, on my own and just be super scrappy and I, I ended up loving that environment where I was actively building and helping something scale. So I've been in various versions of tech startups for the last 10 years doing exactly that, building, scaling and sort of advising in a lot of cases like recent postdocs who maybe have never even been in a company before. And so not only advising on hr, but also a little bit on just business operations and how do we think about scaling and growing and that sort of thing. I love that you are my go to always for these Kinds of questions. So let's start at the beginning, which is just like at what point do early stage startups in our ecosystem, like, what stage they actually have a full time HR person? It varies based on the leader for sure. I typically am brought in anywhere between 30 and 40 employees. Matrix based, interestingly brought me in a tad bit later than that. And some companies have brought me in a tad bit earlier. But that seems to be the sweet spot where like you start bringing in people, I like to say, like off the street who aren't your like immediate core team. And then they're not like up for anything anymore and they're like, you know, they start to speak their mind and you know, HR issues start to arise and someone has a baby or you need to fire someone and then it sort of snowballs and then they are like, you need to bring in someone full time. But what, what do the early, early teams who are less than 30, what do they typically do in the interim between, you know, having no one and then having someone full time? A lot of them will find a consultant who they can just sort of pull in ad hoc when they need. I've done that for, for multiple sort of very early stage companies. Like two or three people who are like, I just need to like we need like the CEO is having a baby and we need to write a parental policy. So very ad hoc hourly work. Also, I hate to say it, but ChatGPT is, has been really helpful for those types of things too. Like if you have something that doesn't require a lot of legal finesse or compliance finesse and you just need to sort of like spitball with someone. ChatGPT can also be really helpful. I love that. How do you find a fractional HR person? Like what would you advise people to do to find someone good? Talk to your peers. Usually like peer companies in similar stages have already found someone or know several people. I know obviously the engine has a really good ecosystem of, of people like that. Right. That they can send you to. I think it mostly just network like asking around. Feel free to reach out to me. Happy to help or point you in the right direction. But yeah, I think when the people are around, there's also like consulting companies that you could go to. Those tend to be a little bit more expensive than sort of an individual fractional person. But the benefit of those is that they offer sort of a full team, full service type of an experience where they have like legal experts and comp experts and hiring experts and those types of things. So it kind of just depends on what you're looking for. Let's get right into the messy hard stuff. Let's talk about firing, which is always the topic that as a coach, folks come to me and they're like, I have this problem situation. What do I do about it? Talk us through the process from sort of, I know I have to sort of probably off board someone to them being off boarded, sort of. What would you advise someone who's never had to fire anyone before on how to do this? So the first thing I always say to someone who's never done this before is that firing somebody goes against like every human instinct that you have and it feels horrible. There's no way to do it, that it's going to make it feel less horrible. And so you just have to like do it in the most respectful and humane way that you can and rip the band aid off and just move through it. A lot of times when I advise people, they're like, well, what if we did it this way? And what if we did it this way? It's going to feeling so crappy the whole time, no matter what. So that's sort of the first thing. As long as you just accept it that it is just business, then it makes it maybe a little bit easier. And then I would say the other sort of overarching thing, before I get into the details, is like, I'm a big proponent of, of acting early on these things. You don't have like a week at a startup is like a year, right? And so you don't have time to sit around and like wait for it to get better and coach them and put them on a pip and all this stuff, like a pip when you're three people is not going to work. It's not. And so I think for our listeners, what is a pip just to make sure. Oh yes, a performance improvement plan. And that typically looks like, you know, three to six months of like outlining exactly where the problem areas are and like coaching them on how to get there and measuring their progress. And then like by the end of the pip, then you take like it. That works well. Maybe in a larger company it works well. Also when you're worried about potential legal repercussions, like if they're a protected class or if you maybe haven't handled it well from the beginning, a PIP can be helpful, but in general I'm pretty against them because I just think they draw out the inevitable, especially in teams as small as the ones that we're talking about. When you start to Feel the little like tingle of like maybe this isn't working out. Start documenting everything, right? You want to write down what isn't working out and when and all the examples of it. You want to be talking directly to this person and saying like, hey, can I give you some feedback here? And then follow up in an email with the feedback, right? So you want to have everything written down. You want to make sure you've spoken to this person about the areas that you're concerned about. If that's not working after a couple of weeks, then I would say like maybe we start thinking about more seriously about having a termination conversation. What that looks like is probably 10 minute max conversation where that takes a lot more planning than it does to actually like do. Right. So prior to going into the conversation, you'll want to make sure that there's redundant redundancy in access to all of the things that they have access to that somebody else has. You know, a majority of the knowledge that this person that you're letting go also has. Right. Like ensuring some continuity. You also want to, if you don't have an HR person on staff, maybe talk to an HR person or your legal counsel just to make sure that there's nothing about the situation that could put you in trouble. Some examples of those things might be this person recently told you that they need a medical leave, or this person is a protected class based on like race, gender, age, et cetera. If this person is pregnant, you know, catch my drift? And then you want to plan sort of the communication around it. And I'll go back to what I said before, which is that none of this, all this goes against like all of your human instincts, right? So what you're going to want to do is get them in a room, say maybe two sentences and then send them on their way. What are those two sentences sound like? Can you, can you model it for us? Yeah. So typically it sounds something like, thanks for coming in today. Unfortunately, I have to let you know that today will be your last day at the company or we're giving you two weeks notice. You know, this is what it's going to look like. You know, it's unfortunate that it didn't work out. We wish you the best. Here's your severance package. Right. And so, and those are other details that, you know, you get into the weeds if you want to offer a severance package when and why that might be helpful. Legal counsel can always help you with that as well. But it's, it's really just a two sentence thing. The two things I always advise are don't start getting into the weeds and details. They're going to ask you why, they're going to start citing examples, they're going to keep pushing back. And your response to that is, unfortunately, this decision is final and we wish you the best. And then the other thing I advise is never apologize. It's going to feel so tempting to say I'm sorry, but for somebody who might lean litigious, you saying you're sorry is like an immediate hook. For them to be like, oh, well, they must be doing something that I can sue them for. So you never want to say sorry, you never want to answer questions. You just want to get them in and out as quickly as possible and then make their transition as smooth as possible. I think that's where the humanity and the respect can come in. Right? Like, we'll take care of all of this for you. Here's your severance package. Right? Like, here's the information about cobra. If you offer benefits, all of those things you want to have, like, prepared in advance. How do you manage the change with the team? Great question. My experience is that every team likes to handle this very differently and it depends on the culture of the team. So there's a bunch of different ways you could do this. If it's a larger team, sometimes the leadership will find an excuse to gather the team in a separate area and then once it has been done, they'll sort of announce it. Other teams prefer more of like a one on one approach to sort of like, just let each of their team members know what happened and answer questions. Any way that you do it, you want to share as little information as possible. A lot of it is should be treated as confidential information. Most of the team does not need to know why somebody was let go. They just need to know what happens next. And typically when teams hear that somebody has been fired, especially if it's the first time your company is firing somebody, the first thing they're thinking is, oh, my God, is my job safe? And maybe there's a split second beforehand where they're like, oh, I feel so sad for my colleague. And human nature is immediately after that they're like, oh, my God, am I safe? And so what you want to do is focus for two seconds on saying like, hey, this is what happened. We have a plan. And then focus on the future. Right? So what does this mean for us? Are we replacing this person who's taking on their workload? How will you, as the rest of the team know if you are not in good standing, performance wise with the company. Right. Like, what are our processes around managing performance? Those types of things are what I would include in communication to the team. Would you tell someone that this person was fired for performance issues? It's very nuanced. Right. I think there is trust to be built in showing a team that the company doesn't tolerate poor performers because usually the rest of the team is feeling the poor performance as well. So I think there are situations where it is appropriate to share that there are performance issues. A better phrase is that it turned out not to be a good fit and the people who have been working with that person will understand why and you don't really need to say much more. So day of choreography. I often get into like a minute by minute play with my clients to make sure that everything is thoughtful so that it doesn't surprise people that like this person's email was cut off before they understand what's going on. So, like, do you have any tips for people on just sort of like the choreography of how you move through it so that it's relatively smooth? You will want to line it up so that whoever controls your IT is shutting off their access while you're in the meeting with them. Um, unless it's a situation where it's going to be amicable and you're giving them a couple weeks notice, you'll want them to leave everything in the room after the conversation and they don't have access to anything. But if it happens before, like you said, that's going to freak people out. And so it needs to be like very well orchestrated. You need to have somebody on the other end. Maybe your laptop is open and you give a thumbs up to the IT person as you're uttering the sentence. So there's a lot of like, those types of dynamics at play. The other piece that often trips people up is that in Massachusetts, you're required to give somebody their final paycheck on their last day of work if you're firing them. And so that can be confusing because a lot of your clients, j, I imagine, use gusto. And gusto notifies you when you get paid. And so that is really horrifying. And so if you send payment to arrive on somebody's last day, they're going to get an email at 8am that they've been paid and then they're going to say, hey, I thought payday wasn't today. Some ways that I've gotten around that is you can write a paper check and then just like record it in your payroll system. You can also tell them that you can buy yourself two days. So if you're having a conversation on a Wednesday, you could say Friday is your last day. You're not expected to work the rest of today, Thursday or Friday, but you'll receive your paycheck on Friday and then you can sort of send it through your normal process. They'll be notified, but they'll already know what is happening. That's my preferred method, just for our listeners. Why do you have to cut them off so abruptly? This is one of those things that doesn't feel superhuman. There is a huge risk. Or what people are often fearful about when they're terminating someone is that they're gonna like fly off the handle, right? They're gonna go and send emails to all of their customers and investors that they were mistreated, they're gonna falsify data, they're gonna sabotage an experiment, they're gonna steal something, they're gonna cause a scene that has never happened in my 10 years in HR personally, I know that it's happened to some people. You just wanna be prepared for the absolute worst. And what I tell myself is like, that person has a support system that will give them all the warm and fuzzies and the hugs and the comforting and let them know that this is the way the world works and all of that stuff. And so your job in the moment is to just protect your company and your remaining team. So the way you do that is by getting them out the door as quickly as possible and cutting off all of their access so that there is no opportunity for them to even think about sabotaging your company in any way. So one last question, which is how do you manage the transition between you shutting them off from all of your and the gap of time between you communicating to the team what is happening so they're not confused. Tell the team as quickly as possible. So you want to go from termination meeting to talking to your team. Especially in a small team, word travels fast. One of them is going to probably see the person walking out or packing up their desk or, you know, whatever it may be. This is one of my HR Pro tips. a startup, like, everyone's going to know in two seconds. So you want the message to come from you, ideally in the way that you want it to be heard. And so schedule time to talk to the team immediately after the termination meeting. This is so helpful and I 100% agree with everything you've said from my own experiences as well. It's so hard. I once had to fire someone actually on their first day. It was an awful, it was an awful experience. And I was sitting with an HR representative who reminded me that the second this doesn't feel awful, you've lost your humanity. So just remind yourself that, you know, it, it shouldn't feel good because, you know, it's a horrible thing to have to do this to someone. But also you are responsible for the success and outcome of your startup and you have to do what you need to do to, you know, hit those technical milestones and bring in the resources to keep moving. Yeah, completely agree. So we're going to shift gears in our last few minutes to talk about another heavy hitter topic, which is parental leave. I often send people to you saying they have no idea what to do. Can you give us a few tips on when you have your first person who's going on parental leave? You have to sort of set a precedent for what's going to happen in the org. So what tips do you have for folks on how to think about this? Yes. So I'll start there. What you do for the first person, you have to pretty much do for everybody else forever until you make like a concerted change in the written down policy. This is really important because pregnant people and folks who need to take a medical lead to take care of a pregnant person are protected classes, which means if they sue you for mistreating them, they'll probably win. This is also true of adopted families. Any sort of bringing a child into your life, correct? Yes. Yeah. Thank you. So typically where I'll start is by telling people that Massachusetts offers paid parental leave legally to every employee in Massachusetts. And so baseline, you're required as an organization to allow your employees to take, I believe it's up to 20 weeks of job protected parental leave. 20 weeks if you're the birthing parent. I think it's a little bit less if you're not the birthing parent. And so even if you don't do anything else, even if you don't top up the pay or offer anything more generous, like you have to offer them that leave and their job has to be available at the same rate of pay when they return, period. A lot of companies will choose to do more than that. So some ways that you could do that are Massachusetts paid family and medical leave usually pays roughly 60% of salary during the leave. It varies and the calculation is very confusing, but a lot of companies will choose to top up the additional 40, 40ish percent so that the person on Leave is making their full salary while they're out. You could also do that for like a certain little period of time, for like maybe the first six weeks. And then they're only on mass paid family and medical leave. So that's one way to do it. You could also extend the amount of time that they have. I know that's not usually super attractive in a small team. And so people typically tend to go for the increased pay, but legally you're not required to do anything except allow them to take it. And that's also totally fine. It's like a pretty generous state leave. The way to do it is that you as a company to be registered with Massachusetts PFML as an employer so that you can go in and manage the portal and see applications. State that, oh yes, paid family and medical leave, Mass pfml. Yeah. And then the employee needs to register on the employee portal and that's where they'll submit an application, it'll come to you, you'll approve it, and then you just have to sort of manage your payroll around it whenever the person goes on leave. So here's a, here's a tricky one. Can you have someone come and do like an hour a week while they're on paternity leave so that the transition isn't as harsh? Especially when you have a senior leader who's the only person who has that expertise on your. Is that possible to do? It is possible to do. The most compliant way to do that is to have that person apply for intermittent leave through the Massachusetts PFML portal. That will allow them to submit hours instead of just assuming that they're taking a certain number of weeks off. And then they'll only get paid by the state for that certain number of hours. And then you should pay them through your payroll for the rest of the hours that they work. That's the easiest way to do it. There are other ways to get creative around it, especially if you have like PTO or unlimited vacation or stuff like that. But compliance wise, that is probably the best way. That's super helpful. I have a lot of CEOs who are having babies, especially female CEOs who are having babies and trying to figure out how to juggle, you know, the early days of a new child while also running the company. Any tips for them on how to do this? Honestly, the tip that comes to mind is to model what you'd like to see from your employees in the future in these situations. Especially like taking time. Right? Like please take time to take care of your child, especially assuming that you've hired a team that you can trust to keep things moving and then just communicate. Right. I think using the Massachusetts PF&L portal is relatively easy to use for a state platform. And so that piece actually isn't the hardest part. It's mostly just like setting boundaries and communicating when you'll be working and what you're needed for versus what you're not needed for and, and those types of things. And I think especially in these early, early stage companies, that sets the tone for the way that everyone else is going to behave. I love that I have a. We actually have a tool in our founder leader toolbox that is a communic to help people communicate exactly those things. And I'll link it in the, the written version of this, the transcript so that people can have that along with this. Lexi, we're about to wrap up and I just want to like what is your number one head of people tip for early stage hard startups? What is. I thought about this and can I have two? You can have two. You can have two. So my first is document. Literally everything. Even if it feels tedious, you're gonna be really grateful someday that you have it. So if you're giving feedback to someone, even if it was just like in passing, doesn't feel like a big deal, take a second to shoot them an email about it and say, hey, just want to document that we talked about this. Up to bigger things like how you planned for your parental leave or things like that. Right? Like just how you want to have everything documented. You never know when you're going to need it. The second one is think about culture and values early and often and talk about them a lot. I think if you can define the type of company that you want to build from a people experience perspective, you're going to be able to hire better, you're going to be able to manage better, and you're going to be able to fire more easily. Right. It's a lot easier to say that someone isn't a good fit when you know what a good fit looks like and you can articulate it. And so if you are able to carve out time to talk about document, think through what your values are as an organization, as a leadership team, what that looks like, how that plays out behaviorally in your company, and the type of experience you want your employees to have and your customers to have, that goes a really long way and you can always scale on it, you know, over time as you grow. I'm so grateful that Those were your tips. Those are wonderful tips. And I double down on all of them. Yeah, yeah. And they, I think the thing that people, people will roll their eyes about it, right? Because I think you're literally inventing things. You're creating the next big fill in the blank in whatever industry you're in. And that feels and is extremely important. And like there's already not enough time to do that. But if you want to build a company that is scalable and sustainable, you, you think about the other stuff. Alexia, I cannot thank you enough for taking the time to share your extremely thoughtful tips with us. Just so incredibly helpful. Thank you so much. My pleasure. Truly. I love, I love startups, I think, I mean, I know they're the future and I love helping well intentioned people build something that's going to last. So. And I admire the work that you're doing so much, Jay, and thanks for having me. Thank you for joining. From founder to leader. Full transcripts of the podcast are available on our website, foundertoleader.com that's founder the word T O leader.com and if you're looking for more concrete tips, tools and guides to accelerate you as you build, check out the Founder2Leader toolbox. You can buy a membership as an individual, as a team, or as an enterprise for your accelerator or portfolio. And if you're looking to skill up with a coach, please reach out. We'd love to meet you, hear about your goals and explore how we can support you. Building hard tech doesn't need to be so hard. We got you.