Terminating Employees

“Discharge,” “downsized,” “adversely affected” - however labeled, getting fired is a traumatic experience for most employees. And it can be a dangerous undertaking for employers. It is a time when many employees recall the contract-forming promises; the age, sex and race-based comments that (employers later learn in litigation) create a discriminatory, hostile environment; and the whistle-blowing complaints that eventually provide grounds for retaliation claims.

As an added bonus, when the former employee is forced to slander herself to a future employer by stating that she had been terminated from her previous position, a self-defamation claim may be asserted.

When each step of the termination process is carefully considered and implemented, an employer gains at least two advantages.

First, by taking the time to articulate and analyze the exact reason for the adverse employment action, the employer is forced to carefully weigh termination vs. continuation options.

Second, in the event of litigation, proper documentation supporting the rationale for the decision and evidencing a routine termination process can greatly reduce the likelihood of an unfavorable result.

The decision to terminate, the actual termination and the aftermath must be handled with great caution and sensitivity to statutory and common law.

In the process of determining whether to terminate an employee, the employer is creating evidence. Every document drafted and every conversation conducted will be subject to intense scrutiny if litigation commences. Every manager involved could be the next deponent, every document an exhibit.

If, for example, an employee is discharged for poor performance, specific examples of such performance — and not just conclusive statements — need to be plainly stated in review documents.

Of course, from a litigation perspective, in the best-case scenario, the employee’s personnel file includes negative reviews, unexcused absences and perhaps a performance improvement plan that the employee agreed to, but failed to satisfactorily complete. Without this documentation, a manager may be suspect of discriminatory behavior.

Employers may also be remiss in not examining the history of the firing manager as part of the process — is the decision maker prone to adversely impacting employees of a particular protected class? In the end, the employer should either be satisfied that the termination can be justified to a jury or rethink the decision to terminate.

In order to avoid potential litigation claims arising out of the termination, including defamation, emotional distress, invasion of privacy and other claims, employers should consider the following steps:

  1. Schedule a discharge meeting with the employee in a private office or conference room, either before the workday begins, during lunch or after normal business hours. If possible, arrange for a time when the majority of the work force is not at the office.

  2. A second member of management should be present to take notes and potentially serve as a witness if the employee attempts to misrepresent the statements made at the meeting, specifically, with respect to the reason for termination. Consider recording the meeting.

  3. State the reason for termination. Frequently, because managers have a personal relationship with an employee, they fail to be completely honest regarding the true basis for discharge. A common reason offered is a down-turn in business. When the action is followed by the manager hiring a replacement almost immediately, a sympathetic jury is more likely to believe the lie was a pretext for discrimination and less likely to believe the manager was trying to be compassionate.

  4. Even if the termination decision has already been carefully made, the manager should still be open to hearing any additional information the employee has to offer.

  5. If the manager is not knowledgeable about the employee’s benefits and final payroll information, make sure the employee can be referred to the appropriate person following the meeting.

  6. Consider security risks. You may wish to deny the employee access to computer systems, company credit cards and the facility in general, as well as have the employee escorted to his work area and the exit. In extreme circumstances, in which an employee is potentially violent, consider establishing an emergency response team such as an employee assistant’s counselor, or forensic psychiatrist and a security guard.

Former employees — even those who elect not to immediately pursue legal remedies — may still haunt their former employers. The after life of an employee — the communications an employer issues or does not issue can create still further liability for the employer. Generally, employers enjoy qualified privilege when they communicate information about an employee to a prospective employer. This advances the dual public policy purpose of allowing employers to give opinions and information to people legitimately making inquiries regarding former employees, while protecting the job seeker from malicious undercutting by a former employer.

Legislation granting immunity to employers that give truthful job references to prospective employers has been enacted in several states. Ordinarily, the statutes prescribe what information an employer may provide and still retain statutory immunity.

With respect to requests for referrals, employers are advised that, as a general rule, letters of reference should not be offered, first a negative assessment though arguably privileged, may result in a defamation claim, second, a glowing recommendation upon which a respective employer relies may result in a suit by the subsequent employer if that employer incurs damage as a result of hiring the employee.

If negotiated as part of a separation package, such letters should be limited in scope and include only title, dates of service and a description of duties. More detailed recommendations must indicate particular strengths or accomplishments. If a company decides to adopt a limited disclosure policy, it should be communicated to all managers to insure consistency.

Finally, employers must also be aware of potential liability under tort theories for providing a false or misleading reference.

From the initial decision to terminate through dealings with future employers, every aspect of an employee’s termination must be handled with care. Serious consideration to each step in the process should result in an increased likelihood that an employer will prevail in litigation.

Provided as an educational service by John Raymond Dunham, III, Esq..

This publication is intended to serve you. If you would like certain topics covered, or have any questions or comments, you are invited to contact Mr. Dunham at: 941.951.1800, Ext. 250, Facsimile: 941.366.1603, E-Mail: jrd@jrdlaw.com, Web site: www.jrdlaw.com or write him at LUTZ, BOBO, TELFAIR, DUNHAM & GABEL, Two North Tamiami Trail, SARASOTA, FLORIDA 34236.

This publication is designed to provide accurate and authoritative information in regard to the subject matter covered and report on issues and developments in the law. It is not intended as legal advice, and should not be relied upon without consulting an attorney.