Practical Suggestions for Terminating an Employee
M. DePree, Jr., and Rebecca K. Jude
- When a manager offers a job to a professional and the professional
accepts, both parties are optimistic. Both look forward to a successful
working relationship, but sometimes things don’t work out.
The list of reasons is endless, but sometimes employees overstate
their qualifications, behave inappropriately, or simply cannot
or will not do the job an employer needs done. Even when a professional
provides excellent service, business necessity may require a layoff.
Either way, at some point, a manager will have to terminate an
will make a termination painless, the following 10 suggestions
may make the process less likely to result in a costly legal battle.
The advice is also applicable for a company’s nonprofessional
employees and may be helpful to anyone having to fire a worker.
The first recommendation is easy to say, but may be the most difficult
not fire an employee in anger. This may seem obvious
but, in the heat of the moment, self-control is paramount. Before
discharging an employee, take time to evaluate the decision. A
cooling-off period may not change one’s mind, but it will
provide time to evaluate the decision and plan the termination.
When a manager is confronted with behavior that requires prompt
action, such as intoxication or use of illegal drugs at the workplace,
consider suspending the employee while preparing for a discharge.
employee’s file and the company’s employment policies.
If the file contains a history of warnings, counseling, and opportunities
to improve, then litigation is less likely. The employee should
not be surprised by the decision and may already be looking for
employee whose personnel folder is filled with adequate, if not
glowing, evaluations may conclude that the dismissal is motivated
for reasons other than performance. So for a single instance of
poor performance, consider a written warning, demotion, or an
opportunity to improve after being counseled. If the change in
behavior appears to coincide with a change in supervisors, it
may be worthwhile to reassign the employee to get a second opinion.
No one wants to casually discharge someone who has been, and has
the potential to continue to be, a productive employee.
policy. If a company has written employment policies,
including termination procedures, managers should follow them
consistently. If management ignores company policy, the courts
may determine there was an improper motive for the termination.
If an employer does not follow its written policy or does not
have a written policy, the way management has handled similar
situations with other employees may limit the company’s
actions. From a legal perspective, past terminations may set procedures
as effectively as if the policy had been codified in writing.
complication exists if an employee files a claim with a regulatory
agency such as the Occupational Safety and Health Administration
(OSHA) or the Equal Employment Opportunity Commission (EEOC).
The employer may face a claim of retaliation. Be sure to meticulously
document the reasons for discharge. Absent a detailed record of
misconduct, the likelihood that a court will believe an employer
acted to punish an employee for exercising a right granted by
law increases significantly.
It may also
be appropriate to consider the timing of a termination. Pregnant
women fall within a legally protected class. If a woman is fired
soon after she advises an employer of her pregnancy, a perception
is possible that the two events are related, regardless of what
her personnel file shows. Financial constraints and the need for
benefits create a motivation for litigation. Additionally, a woman
who is fired during pregnancy will elicit considerable sympathy
from a jury. From an employer’s point of view, being right
may be irrelevant.
the reasons for discharge. An employee file should
provide a meaningful history that explains the dismissal. Whenever
a termination is not documented with warnings or efforts to improve
employee performance, a likely conclusion is that there was an
improper motive for the decision.
most states affirm employment at will—which in theory means
the employer or employee may terminate employment for a good reason,
a bad reason, or no reason at all—almost every employee
can claim to belong to a legally protected class. The most common
protected classifications include race, religion, sex, pregnancy,
sexual orientation, age, and physical or mental disability. Employees
may also assert reverse discrimination, which entails protection
under discrimination laws even for individuals not in the minority
group. Prudent managers will place more faith in documentation
of misconduct than a philosophy of employment at will.
truthful. An employer may be tempted to soften the
blow by telling an employee that the company is cutting back when
in fact the employee’s performance is unsatisfactory. Then,
when the employer takes steps to replace the employee, these actions
cast doubt on the employer’s credibility. And, if an employee
decides to take legal action, the employer’s reason may
look like what it is: a falsehood. A lie may lead a jury to question
everything an employer has said as self-serving and false.
the employee at the time of discharge. While not
legally required, if an employee is entitled to payment for time
worked, sick leave, vacation, or anything else, pay the full amount
when the employee is terminated. Money paid at the time of termination
may assuage a disgruntled employee. If payment is not made at
the time of discharge, assure the employee of prompt payment.
If the employer
intends to offer severance, this is the time to do it. A severance
package, however, requires careful consideration. It may buffer
the employee’s transition and reduce the level of animosity
likely to lead to litigation. On the other hand, if the offer
is contingent on the employee signing a release of claims against
the employer, the employee may view it as an acknowledgement that
the employer did something wrong.
In any event,
if an employer offers severance in return for a release, it should
be drafted by an attorney. An improperly drafted release may have
no legal force and may be used against the employer in front of
a jury. For example, if the employee is more than 40 years old,
a release must comply with the Older Workers’ Benefit Protection
Act of 1990 (OWBPA; 29 USC section 626) to effectively release
any age discrimination claim. The OWBPA allows an employee 21
days to evaluate the agreement, and the release must also specifically
acknowledge that the employee had the opportunity to speak with
counsel. Not surprisingly, tendering such a release will probably
encourage thoughts of litigation.
an observer. Termination should be conveyed in person.
Because termination interviews are fraught with emotion, an observer
should be present. One person can communicate the decision while
the other takes notes to document the meeting. If a manager elects
to attend the meeting alone, immediately after the meeting, the
manager should draft a detailed memorandum stating what happened
and what was said.
having both a man and a woman at any termination hearing. If possible,
one of these persons should be the employee’s direct supervisor.
A supervisor may have valuable insights about what action the
fired employee may take. For example, a direct supervisor may
be able to help identify employees who are unlikely to find another
job quickly or who believe the decision is unfair, including those
likely to take legal action.
a termination letter. Rarely is a written explanation
for a discharge required by law. Drafting a termination letter,
however, allows time to carefully think through what is said and
how it is said. The termination letter should be delivered to
the employee upon termination and should convey the decision to
terminate and a general statement of the reasons.
with what can be proved. Give a sufficient reason
to justify termination—more-serious reasons are not necessary.
If an employee admits to an offense, do not draw conclusions that
may be unwarranted or difficult to prove. For example, a professional
begins to miss meetings or the overall performance declines precipitously.
On several occasions, the employee is observed drinking during
lunch. Failure to provide client services or missing meetings
are legitimate reasons for discharge in this case; there is no
need to accuse the employee of alcoholism without evidence
respectful. Termination proceedings should be handled
with as much tact and consideration as possible, regardless of
the reason. It may be helpful to use a neutral location, such
as an empty office or conference room. If the meeting is insulting
and disagreeable, the likelihood of legal action increases.
talking. A lot of time may be spent writing a termination
letter. Let the employee read it. During the discussion, keep
comments short and to the point. The decision has been made and
there is nothing to discuss except to convey the decision and
its terms and conditions. Optimally, an employee will acknowledge
the reasons for termination and leave. If that is not the case,
being drawn into an argument can only create problems for an employer.
For many employers, the natural tendency is to ease the termination
by saying something complimentary, albeit untrue, about the employee.
Do not do it. Words spoken in kindness may come back during legal
proceedings when the employer must admit that the statement was
are not a complete statement of legal advice concerning employment
termination, but following them may help make the process more
professional and less painful, and minimize legal problems.
M. DePree, Jr., DBA, is a professor at the school of accountancy
and information systems at the University of Southern Mississippi,
Hattiesburg, Miss. He is also a consultant, and Rebecca
K. Jude, JD, is an attorney, both at Jude & Jude, PLLC,