No one wants to have to let an employee go. Certainly no one wants a lawsuit as a result of having fired someone. If you must fire an individual, you want to do it legally and humanely. Here are three steps to help you do it right:
The first phase should begin long before any particular personnel problem arises. Be sure you’ve done nothing to give members of your staff reason to believe they have an agreement that guarantees employment, advises attorney Sachi Barreiro.
An oral agreement can create a binding contract, but is seldom a problem for employers, according to Barreiro. “It’s hard to prove in court. It comes down to ‘he said’/’she said.’”
A more common pitfall is some type of statement in the employee handbook that could be read to imply that there is an employment agreement, says Barreiro. She is an editor for Nolo, a publisher in Berkeley, Calif., that produces do-it-yourself legal books.
If you have nothing that constitutes an agreement, your employees work “at will” and you are free to terminate an individual at any time for any reason, as long as the reason is not illegal. In return, an employee is free to quit at any time for any reason, she notes.
There is one exception â if your practice is in Montana. The only time Montana employers can practice at-will employment in the state is during an employee's probationary period, according to the Montana Department of Labor and Industry.
While your employee handbook shouldn’t contain anything that might be read as an employment contract, it should contain clear statements of policies and standards of conduct, Barreiro says. Spelling out what constitutes discrimination and harassment is helpful in avoiding lawsuits because it indicates that you have proper policies in place and are serious about maintaining a healthy workplace environment.
Obviously if an employee has done something egregiously wrong, the person should be fired immediately. More often, however, it’s best to follow a well-documented disciplinary procedure with clear, progressive steps.
First, Barreiro says, assist an employee who is having difficulties by offering coaching. For example, if an employee is repeatedly arriving late for work, remind the employee of your attendance policy and ask if there is a problem you can help address. It’s useful to make a note to yourself about the conversation, but you don’t need to file any kind of document.
The next step, usually, is an oral warning. Explain to the employee what actions need to be taken or what behavior needs to stop. In this case, be sure to document the discussion.
Next is a written warning, with a form for the employee to sign.
“You can do as many written warnings as you want. Some people just do one. It depends on how many chances you want to give,” Barreiro says.
Some employers then choose to suspend the employee but others move directly to termination, according to Barreiro.
In your employee handbook, make clear that these steps are just guidelines and that you reserve the right to alter procedures.
During this process, consider whether the employee in question has filed any type of complaint, Barreiro says. “It could be a timing issue. It may look like you are retaliating if the employee has made a complaint about discrimination” with the Equal Employment Opportunity Commission (EEOC).
“I believe retaliation claims are on the rise,” says Barreiro, who recommends consulting with an attorney before terminating an employee who had filed a complaint.
Whether or not if there has been any type of complaint, you should always be able to say that the dismissal was performance-based and have documentation to back that up.
When you decide that the time has come to when an employee must be fired, consider who will take over that person’s responsibilities and whether you plan to offer severance.
“Make sure to give the employee their final paycheck,” Barreiro says, because many states require that paycheck be given at the time of termination.
Also, consider how you’re going to handle references for the terminated employee. Out of concern for defamation lawsuits, some businesses only give out a former employee’s job title and length of employment.
Pick a good time, perhaps at the end of the week, and a neutral place for the actual termination. Start with a direct statement such as, “We are terminating your employment effective on this date.” Explain how you plan to handle severance, references, and so on, and let the individual ask questions.
If you have documented everything, there shouldn’t be any surprises. If the employee gets angry, let the person vent, but don’t engage, Barreiro says. “You never want to let an employee think they can convince you out of your decision.”
That’s it: Make sure you don’t have an unintentional employment agreement, follow a well-documented disciplinary procedure, and state your termination decision compassionately, but plainly.