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Legal Considerations When Terminating an Employee


By: 
Date: August 25 2011


By Arianna S. Gleckel, Esq. of Bean, Kinney & Korman, P.C.

 
Many employers terminate employees without following some basic procedures that take little effort on the part of the employer but can prevent major headaches later.  Following these rules prior to termination can help employers avoid problems post-employment and can provide a full defense to an employee’s claim of wrongful termination.
 
If you have an employment agreement with the employee, you will need to follow the provisions governing that agreement. However, the majority of employees are employees at-will and therefore the following steps and procedures are highly recommended for employers.
 
First, are you following your own policies? Make sure you follow your own policies and procedures regarding discipline and termination. An employer that does not follow its own policies and procedures risks exposing itself to a discrimination claim.  Human resources should be very familiar with your company’s procedures and should regularly review the handbook to see if changes need to be made. It is important to regularly update your social media policy in the handbook and provide a copy of the revised policy to all employees. You should also have each employee sign an acknowledgement of receipt of the handbook and a copy should be placed in the employee’s file.
 
Second, is there documentation to support the basis for termination of the employee? Unless the employee has committed a clear violation of misconduct, employment disputes often become an issue of “he said she said” between the employer and the employee. To avoid post-employment disputes that turn on each party’s recollections, employers should keep detailed records for each employee. Even handwritten notes that are dated to the file each time there is a problem with an employee are sufficient to create a written record, should the employee file a claim against the employer. An employer’s inability to produce sufficient records documenting a history of problems with an employee will often lead to the judge or jury concluding that the issues with the employee did not really exist or were not as serious as now alleged.
 
Third, is the decision to terminate based on performance? If so, you should have a well-documented employee file that indicates that the employee has been put on notice that his/her performance is not up to company standards and that failure to improve is grounds for termination. Be honest with the employee about the problems with his or her performance instead of using another reason to avoid discussing the real reason for termination. Since the United States Supreme Court decision in Reeves v. Sanderson Pluming Products, Inc. 530 U.S. 133 (2000), employers who do not disclose the real reason for termination may hurt their own case. Disguising termination based on performance by telling the employee he or she was terminated for another reason may help an employee who is claiming discrimination’s case. The employee may claim the “fake reason” for termination was used to cover up the real reason, namely, discrimination.
 
Termination based on performance should only be done when you have provided notice to the employee of the problems, have attempted to counsel them and provide performance plans and have taken other logical disciplinary steps.
 
As soon as unacceptable behavior from an employee arises, the following steps should be taken by the employer to document the file and to ensure that company policies and procedures are applied consistently and fairly to all employees.
 
Step One—Verbal Warning. Have the employee’s supervisor discuss with the employee the problem that has occurred and the corrective measures that need to be taken. Have another manager sit in on the meeting. Make notes to the file documenting the meeting and problems and have both managers date and sign the entry.
 
Step Two—Written Warning. Have the employee’s supervisor draft a written warning that states the nature of the violation and the plan for correcting the behavior. Have the supervisor discuss with the employee the problem that has occurred and the corrective measures that need to be taken. An additional step that might be appropriate is putting the employee on a probationary period. Have another manager sit in on the meeting. Make additional notes to the file documenting the meeting and problems and have both managers date and sign the entry. Also have the employee date and sign the written warning.
 
Step Three—Suspension. The employee will be suspended for several working days without pay. If an investigation is necessary, the supervisor may have the employee leave the office until a final decision is reached and if the investigation absolves the employee of any wrongdoing, he or she will need to be paid in full for the time lost during suspension.
 
Step Four—Termination. An employee being discharged for multiple minor violations should only be terminated once the employer has given the employee the warnings above and has properly documented the file in order to successfully defend any post-employment claims of wrongful discharge.
 
Examples of grounds for termination after following the steps above vary by state but may include:
 
·         Chronic absenteeism or tardiness in violation of the employer’s policy
·         Multiple unapproved absences
·         Inefficiency, incapability, chronic mistakes or misjudgments
 
However, certain misconduct may require immediate termination without prior discipline. This decision should be made by management and what constitutes “misconduct” varies from state to state. The following examples may constitute misconduct that allows for immediate termination[1]:
 
·         Testing positive for a nonprescribed controlled substance
·         An intentional false or misleading statement of material nature about past criminal convictions listed in a job application
·         Any willful and deliberate violation of a state regulation by an employee that would cause the employer to be sanctioned or to have its license or certificate suspended
·         Gross negligence or misconduct by an employee that results in substantial monetary loss for the employer
·         Sexually harassing another employee
 
The internet landscape can complicate the disciplinary process if you have not clearly articulated to your employees what conduct on social media websites is unacceptable and violates your company’s policy. New issues in the employment context continue to arise as social media websites’ popularity continues to grow. Does your current policy prohibit employees from making disparaging comments about your company or other employees, management, etc. on Facebook or employees’ personal blogs? Behavior and conduct that would not be tolerated if written and published in a traditional forum also should not be tolerated on the internet. Your policy should include what conduct is prohibited (along with a list of specific examples that is not exhaustive) and the disciplinary procedures that will be followed for violations of that policy.
 
Finally, if you have a difficult employee whom you have reason to believe may claim wrongful termination or discrimination, contact your attorney before taking any action. He or she will be able to provide additional guidance to you on a case-by-case basis.
 
About the Author
Arianna Gleckel is an associate with Bean, Kinney & Korman. She practices in the areas of commercial and general civil litigation, and has significant experience in employment law. For more information on Arianna and Bean Kinney, please visit http://www.beankinney.com


[1] Check your states employment laws to see how misconduct is defined and what courts have upheld as constituting misconduct in the employment context.


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