Monday, January 12, 2015

Seven Tips for Discharging an Employee For Which Your Lawyer Will Thank You

It’s almost always difficult for an employer to decide that an employee is just not an asset to the organization and should be discharged.  Change is difficult for everyone, including other staff, and employers these days are always wary of discrimination or wrongful discharge lawsuits. We always advise our clients, though, that they cannot be held hostage by poorly performing employees with the threat of a lawsuit. The trick is to be prepared and conduct the discharge in a manner that creates a veritable brick wall of a defense to later claims. Here are seven tips to that end:

1. Be thoughtful in your decision to discharge an employee.
In other words, never knee-jerk a decision to discharge. Of course, some circumstances absolutely require an immediate action. An example is if you first hand witness an employee engage in egregious conduct in the workplace. If you don’t actually have first hand evidence of very bad behavior, it’s generally best to take action only after conducting an investigation. You know that Joe has been rude to the public and co-workers in the past, but don’t automatically assume that a report that he swore at someone on the phone is true. Investigate it first, no matter how reliable the source is.  If the continued presence of the employee in the workplace seems dangerous or disruptive, then place that person on administrative leave (unfortunately with pay) until all of the facts are gathered and analyzed.

2. Review the employee’s file thoroughly before making a  final decision.
Most employers know who their “problem employees” are, but most cannot recite from memory that employee’s performance history.  Ensure that the employee’s performance record supports the decision to discharge when part of a progressive discipline process. Sometimes supervisors handle conduct and/or performance issues without documenting the problems. If that’s the case, the employer should ensure that all of the undocumented events are identified for the employee or they may want to hold off on the final decision until more adequate documentation exists. .

3. Provide a discharge letter.
Of course you will meet with the employee and deliver the bad news in person, but provide the employee with a letter which reiterates the reasons for his or her discharge as well as any other important information that they need to know as they separate from employment. The importance of the letter is threefold. One is to create a paper record of the reasons for discharge well before any claims or charges have been filed. Secondly, the letter will serve as a counterbalance of information to the employee’s version of events if the employee consults with a lawyer. Finally, it reminds the employee of other important information, like when their health insurance will terminate, or when they have to return employer property that was not with them on the day they were discharged. Often employees do not fully process information that immediately follows notice of discharge.

4. Be prepared with back up. 
Most employers know that it is a best practice to have two management representatives in the room when terminating an employee. One corroborates the events as described by the other if they ever need to testify to what happened. Employers should also have a person at the ready to escort the now ex-employee out of the building, if possible. It’s a tough job, but far less tension exists if the person who delivered the bad news is not the one that escorts them out. Additionally, you should have someone at the ready to lock the employee out of the IT system. This should occur right as the meeting starts at the latest – earlier if you have any notion that the employee is anticipating being terminated.\Finally, if you have even the slightest reason to believe that the employee might become violent, have security with you. Many managers fear that the presence of security only escalates emotions and they will appear to be overreacting. We say it’s better to be protected than to avoid others thinking you’re dramatic.

5. Follow the procedures of the union contract or policy handbook.
Don’t get hung up by overlooking a procedural step. Follow the procedures set out in a union contract if one exists to avoid a grievance and the possibility of having to take the employee back. Although employers are not contractually bound to follow their handbook like they are with a collective bargaining agreement, it’s still important to follow those policies and procedures as well. Not only does it eliminate the need to explain an irregular procedure (which the employee will claim was wrongful) but it supports the reasonableness of the decision.

6. If in doubt, call your lawyer
Not only is employment litigation still on the rise, it is also can be expensive to defend – even when the employer is right. It is often helpful for employers when they have a prior discussion with their employment lawyer to identify potential litigation risks and to develop a plan that helps to ensure a positive outcome.

7. Consider a severance package.
Egregious misconduct almost never warrants the offer of a severance package, but in all other situations it can be money well spent. Did we mention that employment litigation can be expensive? A relatively small severance (the amount of which depends on factors such as length of service, the problems which led to discharge, and the particular risks involved) in exchange for a full release and waiver of claims is usually far less than the expense of defending the actions.. Many employees are not prepared financially to be suddenly unemployed and they will sign a release of claims in exchange for a severance payment. Tailor severance packages to what will be attractive to the employee. Many want money, but some would trade money for health insurance continuation while they get back on their feet.

Discharging an employee is a serious event for the worker, the employer and often for co-workers as well. Following these seven steps will not make it easy, but will help to ensure success if a claim or charge follows. And your lawyer will be happy too!