Important Facts To Know About Employee Termination
One of the most necessary, but disagreeable, tasks that an employer
must perform is terminating an employee. It can be an
emotional situation and, depending on the circumstances, damage control
may be necessary to repair harm caused by the employee to morale,
relationships and productivity.
There is also a risk that the employee who was terminated will take legal action against the company. The terminated employee has the right to consult a lawyer; however, there are many things that can be done ahead of time to decrease the risk of a lawsuit actually happening.
1. Ensure that key clauses and disclaimers are included in the company’s hiring documents. At the very least, the offer letter or application should have an “at will” disclaimer. This disclaimer means that the employee understands that employment with the company is “at will”, meaning either the employee or the employer can terminate the employment at any time. The offer letter or application should also have a “truth or consequences” clause. This protects the company if there is cause to terminate an employee for giving false information when hired. In other words, the employee confirms that all information provided when hired is true and that he or she could be terminated if the information given was misleading or false. It is imperative that every employee hired should sign a document containing these and other key clauses and disclaimers. These documents will dispute any claim that the employee did not understand the essential terms and conditions of employment when he or she was hired.
2. There should be genuine job-related grounds for the termination. The law prohibits an employer from using unlawful discrimination to terminate an employee. It is also prohibited to terminate an employee for doing something within his or her legal rights, such as reporting sexual harassment or filing a claim for workers’ compensation. The employer should be sure that there are legal grounds for termination and that these grounds are included in a carefully written letter of termination or, at the very least, in the employee’s file. It would be prudent to consult with an employment lawyer before proceeding with the termination.
3. Be sure to keep a record of performance issues. It is also important, if an employee is performing poorly and the possibility of termination exists, that all warnings and discussions regarding the employee’s poor performance or failure to abide by company rules are recorded. This documentation will likely serve to deter the employee from suing for wrongful termination based on unlawful discrimination or other reasons.
4. The termination meeting should be prepared for quickly but with caution. If the decision to terminate has been made, action should be taken promptly. Problems can arise if the termination is postponed until ‘just the right time’. Firstly, if the employee finds out about the termination, he or she could become disruptive and pose a threat to morale and subsequently, productivity. Additionally, as time goes on, other employees could learn about the situation and cause embarrassment to the individual. This will only cause an emotionally charged situation to become worse. Finally, a delay could allow the employee more time to organize a legal case against the company.
5. It is equally important to carefully prepare ahead of time for the termination meeting. A termination letter should be drafted and vetted by counsel. In addition, severance and vacation pay, as well as any other amounts due, should be calculated and checks prepared. It is also wise to have a witness present and to inform security of the time of the meeting. You should know what you plan to say before the meeting and you should plan to do all of the following:
• Stick to the topic at hand and keep the discussion brief.
• Don’t make promises you may not be able to keep, like assuring the employee you can help him or her find another job.
• It’s fine to say you’re sorry about the situation but be careful what you say. Don’t pass the blame or make excuses.
• Try not to argue with the person. He or she may want to vent and that’s fine, but there’s no point arguing back.
• Collect company property such as computer equipment, hand held devices, company credit cards and keys.
There is also a risk that the employee who was terminated will take legal action against the company. The terminated employee has the right to consult a lawyer; however, there are many things that can be done ahead of time to decrease the risk of a lawsuit actually happening.
1. Ensure that key clauses and disclaimers are included in the company’s hiring documents. At the very least, the offer letter or application should have an “at will” disclaimer. This disclaimer means that the employee understands that employment with the company is “at will”, meaning either the employee or the employer can terminate the employment at any time. The offer letter or application should also have a “truth or consequences” clause. This protects the company if there is cause to terminate an employee for giving false information when hired. In other words, the employee confirms that all information provided when hired is true and that he or she could be terminated if the information given was misleading or false. It is imperative that every employee hired should sign a document containing these and other key clauses and disclaimers. These documents will dispute any claim that the employee did not understand the essential terms and conditions of employment when he or she was hired.
2. There should be genuine job-related grounds for the termination. The law prohibits an employer from using unlawful discrimination to terminate an employee. It is also prohibited to terminate an employee for doing something within his or her legal rights, such as reporting sexual harassment or filing a claim for workers’ compensation. The employer should be sure that there are legal grounds for termination and that these grounds are included in a carefully written letter of termination or, at the very least, in the employee’s file. It would be prudent to consult with an employment lawyer before proceeding with the termination.
3. Be sure to keep a record of performance issues. It is also important, if an employee is performing poorly and the possibility of termination exists, that all warnings and discussions regarding the employee’s poor performance or failure to abide by company rules are recorded. This documentation will likely serve to deter the employee from suing for wrongful termination based on unlawful discrimination or other reasons.
4. The termination meeting should be prepared for quickly but with caution. If the decision to terminate has been made, action should be taken promptly. Problems can arise if the termination is postponed until ‘just the right time’. Firstly, if the employee finds out about the termination, he or she could become disruptive and pose a threat to morale and subsequently, productivity. Additionally, as time goes on, other employees could learn about the situation and cause embarrassment to the individual. This will only cause an emotionally charged situation to become worse. Finally, a delay could allow the employee more time to organize a legal case against the company.
5. It is equally important to carefully prepare ahead of time for the termination meeting. A termination letter should be drafted and vetted by counsel. In addition, severance and vacation pay, as well as any other amounts due, should be calculated and checks prepared. It is also wise to have a witness present and to inform security of the time of the meeting. You should know what you plan to say before the meeting and you should plan to do all of the following:
• Stick to the topic at hand and keep the discussion brief.
• Don’t make promises you may not be able to keep, like assuring the employee you can help him or her find another job.
• It’s fine to say you’re sorry about the situation but be careful what you say. Don’t pass the blame or make excuses.
• Try not to argue with the person. He or she may want to vent and that’s fine, but there’s no point arguing back.
• Collect company property such as computer equipment, hand held devices, company credit cards and keys.