When an Employee Dies: What Managers and Small Businesses Should Do

November 8, 2026|C. Lindorfer

If you only have a moment

Hear it from the family first, and ask them what they're okay with you sharing. Tell the people who worked closest with them in person, before anyone else, and then tell the rest of the team. Give the family one person to call at work, and over the next few weeks, get them the final pay, benefits information and belongings, gently and in writing.

I've been on both ends of this call. Once as the family: after my husband died, a life insurance policy turned up through his work, and no one there had told me about it. Nobody was unkind. It just wasn't anyone's job to make sure the family knew.

And once as the one making the call, with no training and no one to ask. I muddled through, and thankfully got it right, but I was guessing at every step.

That's why I wrote this. If you own a small business or manage a team, and there's no HR department to hand this to, this is for you. Perfect isn't the goal. You need to be kind, be clear, and be the one person the family can call.

And it's the same whether they were full time, part time, seasonal, a contractor or brand new. Grief doesn't check the payroll category.

Jump to: The first day · The first week · Quietly turn these off · Their desk and belongings · Pay and benefits · The months after · Printables

The first day

Make sure it's true

Hear it from the family or someone close to them, not from a post online or a coworker's text. News moves fast, and sometimes it's wrong. If you only heard it secondhand, a gentle call to the emergency contact on file comes first.

Calling the family

The owner, or the manager who knew them best, should make this call. Keep it short.

You might say: "I'm so sorry. We all thought the world of her. I don't want to take much of your time today. I'm calling so you know we're here, and I'll be your contact for anything with work."

Don't ask how they died. Don't ask about passwords, keys or unfinished work today. That can wait, or someone else on the team can figure it out.

Before you hang up, ask two things:

What are you comfortable with us telling the team?
Who should I talk to in the coming weeks, and is a call, a text or an email best?

Telling the team

People who worked closest with them hear it first, in person, or on a call if they're away. Nobody should find out from a group chat.

Then tell everyone else, in person or on a video call if you can, so people aren't alone with the news. Send a short email afterward to anyone on another shift, working from home, out sick or on leave.

Say their name, that they died, and what you know about what happens next. Say they mattered. Don't share how they died unless the family wants it shared. "We don't have details, and we're going to respect the family's privacy" is enough.

Let people step away. Some will need a walk, a quiet room, or the rest of the day.

Customers and clients

In a small business, customers knew them too: the regular who always asked for her, the client he'd looked after for ten years. Decide who tells them, and make it personal, a call or a short note rather than a bounced email: "I'm sorry to tell you that Dave passed away last week. He always spoke well of you. I'll be looking after your account now, and I'm here if you need anything." Ask the family before anything goes on your business's social media.

If it was a suicide

Follow the family's lead on what's said. The National Action Alliance for Suicide Prevention has a free guide made for this, A Manager's Guide to Suicide Postvention in the Workplace: 10 Action Steps, and it's worth reading today.

If you have an EAP

An Employee Assistance Program often offers free, private counseling, sometimes for family members too. Share the number with the team the same day, and again a week later. If you don't have one, a local hospice grief program is often open to anyone in the community.

If they died at work

Call OSHA within 8 hours: 1-800-321-6742, or use OSHA's online form. If someone dies within 30 days of a work incident, that has to be reported too. Some states run their own safety programs, and their rules may differ. A death at work brings a lot more, for the people who saw it most of all, and I'll write a full guide on that separately.

The first week

The funeral

Let people go. If you can, give paid time to attend. Some faiths hold the funeral within a day or two, and some families travel far or wait months for a memorial, so be flexible about when people need the time. Small businesses sometimes close for a couple of hours or ask a neighbor business to help cover; customers almost always understand.

Ask the family, through your contact, whether coworkers are welcome. Most families are deeply touched to see people from work there. A few want it small.

Send something from the team: a card everyone signs, flowers if the family wants them, or a gift toward whatever they've asked for. If you're stuck on the words, the Sympathy Message Helper has choices for writing as their boss and as an office or team.

Quietly turn these off

This is the part almost nobody warns you about. A week after the funeral, a "Happy work anniversary!" message goes out with their picture. A coworker gets a meeting invite with their name on it. Their family gets an automated email from your scheduling app.

Each of these hurts, and each one is easy to stop if someone thinks of it. Make it one person's job:

Email: don't delete it yet; there may be things the family or the business needs. Forward it to a manager and, if the family is okay with it, set a short auto-reply giving another contact.
Voicemail: before you change or delete it, ask the family if they'd like a recording of the greeting. Hearing that voice again can mean more than you'd think.
Work phone and computer: there may be personal photos or messages on them. Ask the family if they'd like copies before anything is wiped.
Calendar: cancel or move their meetings and recurring invites.
Birthday and work-anniversary reminders in payroll, HR and team apps.
Schedules and rotations: take their name off future shifts and on-call lists.
Group chats and team channels: remove them quietly, and not the first day.
Badges, door codes, keys and parking spot.
Mailing lists, vendor and customer accounts in their name.
Your website, staff page and email signatures: ask the family before taking down a photo or bio.

Their desk and belongings

Don't box it up the first day. Let it be for a little while.

Ask the family if they'd like to come pick things up, maybe after hours when it's quiet, or if they'd rather you pack and bring them. Ask a coworker who was close to help, if they'd like to. Pack carefully: the photos, the mug, the sweater on the chair. These matter more than they look. Keep work property separate, and hand everything else over in person if you can, not in a shipping box.

If you have photos from work, the holiday party, the team lunch, the day they were thanked for something, gather them for the family. Ask coworkers to write a few lines in the card about what they were like at work. Families often never got to see that side of the person they lost.

Pay and benefits, in plain words

Families are often in a fog for months. A clear list, written down, may be the kindest thing you hand them.

The final paycheck

Pay everything owed: wages, and unused vacation or PTO if your state's law or your own policy says it's paid out. Who you pay depends on your state. Many states let a surviving spouse or family member collect wages without going through probate, up to a limit. In California, a spouse can collect up to $20,875 from all employers combined for deaths on or after April 1, 2025 (Probate Code 13600, as adjusted). Your payroll provider or your state labor department can tell you the form and the rule where you are.

For whoever runs payroll

The IRS has its own rule for an employee's final pay:

Paid in the same year they died: withhold Social Security and Medicare, but not federal income tax. Report it on the W-2 in boxes 3 and 5, not box 1.
Paid the next year or later: no W-2 and no Social Security or Medicare.
Either way: also report it in box 3 of a Form 1099-MISC to the estate or the person you paid.

If a paycheck went out and wasn't cashed, ask your payroll provider how to reissue it to the right person.

Life insurance and retirement

Life insurance through work, a 401(k), a pension: these go to whoever is named on the beneficiary forms, not to whoever is named in the will. Tell the family about every plan they had through you, even small ones, even ones they may have forgotten. That's how the policy I never knew about could have been found sooner.

A group life insurance claim usually has a part the employer fills in. Offer to start the claim with the insurance company and do your part quickly, so the family isn't left waiting on you. If they died from something that happened at work, the family may also have a workers' compensation death claim; tell your carrier right away.

Health insurance

If you have 20 or more employees, federal COBRA lets the spouse and children keep your group health plan for as long as 36 months after an employee's death. You need to tell your plan about the death. The family then has 60 days to choose it and 45 days after that to make the first payment, and it can cost the full premium plus 2%. Smaller businesses: many states have their own "mini-COBRA" rules, so check with your state insurance office. (Department of Labor COBRA questions)

One person, one list

Give the family one name and phone number at work, and a short written list: what pay is coming and when, what benefits they had, what forms are needed, and when you'll bring their things. If they're also writing to every company that needs to know, the Who to Notify Letter Maker has a letter just for employers.

What hurts, even when no one means it to

A box of their things left on the porch. A final check mailed with no note. A letter asking for the laptop back in the first week. A job posting the family sees before anyone has called them. Each of these is easy to avoid once you've thought of it.

The months after

Most guides stop at the funeral. Grief at work doesn't.

Check in with the people who were closest. At a week, at a month, at three months. "How are you doing with all this?" in private goes a long way.

Be honest about the work. Someone will have to cover it. Say so plainly and thank them, rather than quietly piling it on the person who sat next to them.

Go slow with the empty chair. Ask before someone moves into their desk. Hiring is fine; just tell the team before the job posting goes up.

Mark the hard dates on your calendar: their birthday, the holiday season, a year since they died. A short note to the family that day, or a quiet mention at work, tells everyone they weren't forgotten.

And you

If you're the one holding this together, you're grieving too, and doing it while keeping the doors open. Let someone else make a call or two. Use the EAP yourself. If you tear up in front of the team, that's all right. It tells them they can too.

Printables for managers and families

Manager's Checklist: When an Employee Dies (2 pages). The first day, week and month, and the months after, with space for the family's contact and what they can expect from you. En español

Quietly Turn These Off (1 page). Hand it to one person, with a place to note who did each one and when. En español

When You Need to Tell Their Employer (3 pages, for the family). Words for the call and what to ask work about, from the last paycheck and life insurance to a recording of their voicemail greeting. Kind to print and hand to the family with your card. En español

You can do this

You won't say everything right. No one does. What families remember is who called, who showed up, and who made the hard parts easier. You can be that person.