Cenek Report

The American physician & writer, Austin O’Malley, once stated that “revenge is often like biting a dog because the dog bit you.”

Like a cantankerous dog, terminated employees will sometimes strike back too, especially if they’ve been shoddily treated on the way out. In the case of ex-employees however, they are not striking back with fangs, but rather with a two-legged guard dog that’s morphed into a lawsuit.

Granted, not all employment-related litigation is avoidable. But if an employer is careful, forthright and professional with an employee during the separation process, the odds of an amicable separation are much higher. While the Golden Rule is a good starting point, there are other actions that employers should take to avoid the most common miscues in employee terminations, as described below. They are:

Breaking Promises

Broken promises generate a significant amount of employment-related litigation. If an employee believes that the employer has failed to deliver on a past promise, he or she may sue for breach of contract. Contracts are often unknowingly created, and with a fair amount of ease, as they can be created through an oral or written promise to the employee. There are two key activities that employers should undertake to minimize litigation based on alleged breaking of promises.

One, train supervisors to be careful what they say and promise.

Two, ask each new employee as a condition of their employment to sign a separate document that acknowledges that the employer does not generally enter into written or oral contracts or agreements guaranteeing employment or compensation. This document should further state that no employee is authorized to make such guarantees of employment or compensation, unless an express agreement to the contrary is signed by a designated person in the firm, which is typically the CEO or VP-HR, as well as the employee.

Failing to Warn and Document

Inadequate documentation of employee issues is a very common problem in most organizations. The causes are many, but at the end of the day very few people relish delivering “bad news.” The end result: the employee does not receive the feedback that he or she needs to improve their work performance. Courts and qausi-judicial bodies often frown on terminations that are not supported by adequate documentation and history, especially if the employer has a stated progressive discipline policy with a series of steps (and chances) that generally must be followed – unless of course the employee’s behavior is particularly egregious and requires immediate dismissal. Employers are much better to embrace the old Holiday Inn motto, which is “the best surprise is no surprise.” Provide feedback regularly.

Inconsistency in Policy Administration

Some lawsuits arise because an employee believes that he or she was treated differently due to sex, race, or membership in another protected class. An employer that does not consistently apply its policies will increase the risk of such discrimination claims. Not treating a member of a protected class according to stated policy will be deemed as prima facie evidence of discrimination in many settings. Organizations would be best served to make deviations from policy rare and only in response to extenuating circumstances.

The Fast Termination

Quick, emotionally driven separations naturally invite legal challenge, plus they often send tremors thorough the workforce. If at all possible, avoid firing someone “on the spot.” Instead, an employer should thoroughly investigate before deciding to terminate. Before terminating an employee, the employer should have a neutral officer, human resources professional, or legal counsel review the facts and proposed decision. If the final conclusion is that termination is appropriate and necessary, it’s advisable to wait at least one day to be completely certain that this is the best course of action.

Terrible Timing

All employers “must be able to walk and chew gum at the same time” when it comes to properly coordinating the timing of an employee’s involuntary separation. For example, terminating an employee soon after the employee complains of discrimination or other unlawful activity, or files a workers compensation claim, will lead the employee, and potentially a court, to conclude the firing was in retaliation for the employee exercising his or her legally protected rights. A good rule of thumb is to have multiple levels of review for disciplinary proceedings. This helps to ensure that “many of the bases have been covered,” and that the action being contemplated does not feel precipitous in nature.

Bad Optics

Some employer actions will look incredibly bad to the average person on the street – no matter how much window dressing is applied. These actions have the potential of influencing the emotions of a jury or judge – or at the very least, creating a dark cloud over the work environment. They include:

• Not giving the employee an opportunity to explain his or her actions before their termination.
• Firing a long-term employee without coaching or documentation.
• Firing before a holiday, during a holiday season, or shortly after a tragedy in the employee’s family.
• Escorting the employee out with the aid of security guards or law enforcement officials (unless of course the employee is acting belligerently or threatening others).
• Not allowing the employee an opportunity to gather personal belongings and say goodbye to fellow employees.
• Discussing with the terminated employee’s co-workers the reasons for termination.
• Badmouthing the employee, especially to references.

Positive Actions for Employers to Follow

There are a wide variety of practices that employers should follow to help create a strong feeling of due process and fair treatment before, during and after employee separation. They are:

Terminating with Dignity and Respect

• The immediate supervisor should personally deliver the news.
• Do not sugar coat your explanation. Be direct, but supportive.
• Consider paying severance to help support the employee while they are transitioning to new employment, if appropriate.
• Keep the reasons for termination confidential

Establish an Internal Grievance Procedure

• Signals to the workforce that the employer is ethical and principled, and willing to take significant steps to ensure that every employee receives fair treatment and due process when resolving employment-related issues.
• An internal grievance procedure may afford the employer some element of protection if an employee voluntarily terminates and then files a complaint or sues claiming mistreatment or discrimination. Quasi-judicial bodies and court systems will sometimes review this to determine if the employee has acted in good faith to resolve their issue or complaint.

Provide Severance in Exchange for a Release

• An employer should seriously consider offering terminated employees severance in exchange for a full release of claims. It may be appropriate given the circumstances