Terminating an employee is never a pleasant experience. You can, however, limit the ongoing unpleasantness by reducing your exposure to wrongful discharge claims, says Laurie Baulig, an attorney at Scopelitis, Garvin, Light & Hanson in Washington, D.C.
Speaking at the 12th annual Randall Trucking Symposium in Tuscaloosa, Ala., Baulig noted that terminations, not surprisingly, create the greatest potential legal exposure of any action an employer could take. The most important precaution, Baulig says, is documentation. Discipline should be progressive, and companies should require supervisors to discuss issues with employees. In addition, employers should do everything possible to ensure consistent application of their policies.
The pitfalls don’t stop with the decision to terminate, however. The termination meeting itself is critical and, if poorly handled, could undermine all of an employer’s efforts to steer clear of trouble, Baulig says.
Baulig suggests developing and closely following a “termination checklist” to ensure you have covered all the basics in reaching the termination decision, handling the meeting and dealing with the aftermath – things like the effect on other employees, unemployment compensation claims and reference requests.
The decision to terminate
Before you firmly decide to terminate an employee, someone not involved in the decision-making process, if possible, should conduct an independent review to ensure objectivity.
This review should try to answer:
- Why is the employee being recommended for termination?
- What did the employee do or fail to do?
- Have the reasons for the decision been documented through performanc evaluations, company records and a thorough factual investigation of the situation?
- Are there good reasons for the decision to terminate that can be truthfully told to the employee?
- Is the basis for termination consistent with the employee’s work record?
Next, this review should address whether there is any indication of bias based on gender, race, age (if the employee is over 40), disability, national origin, ancestry or religion. Also, consider whether there is evidence of retaliation for engaging in union activity or complaining about discrimination or whether the employer is trying to avoid payment of catastrophic medical expenses or enhanced retirement benefit.
The independent reviewer should then consider any written or implied contracts that might limit the employer’s ability to terminate. Is the termination consistent with any written policy or with past practice? Was the employee aware of the rule violated? Has the rule violated been uniformly enforced? Has the employee been given a chance to improve?
Finally, consider any mitigating factors, such as prior record or length of employment, and whether disciplinary action would be more appropriate. And make sure management has acted properly.
The termination meeting
Always communicate the termination decision personally and never by letter or memorandum alone. The meeting should occur in a place and time that preserves the employee’s privacy and dignity. It should follow the following structure:
- Announce the decision from the start clearly and definitively. You might, for example, start the meeting with the statement: “The decision has been made to let you go.”
- Review the circumstances of the particular incident leading up to discharge.
- If relevant, review the employee’s past record, performance appraisals and disciplinary record. Keep this brief, however, and don’t let yourself be drawn into a debate. The longer the meeting, the greater the chance you will say something that supports a wrongful discharge lawsuit.
- Give the employee true and actual reasons for the termination.
- Be prepared to tell the employee when the termination is effective, what vacation or severance pay is due and other relevant information. Also, review all insurance continuance rights.
- Review any obligations you expect of the employee, such as return of keys or other company property and compliance with covenants not to compete or confidentiality agreements.
Document everything said during the termination meeting. Following the meeting, minimize contact between the terminated employee and other employees and monitor collection of personal items.
By following a methodical approach, you can ensure that you have given the employee every reasonable opportunity to avoid termination and given your company every reasonable opportunity to defend the decision.
