Firing under-performing employees is part-and-parcel of running a successful business. Yet, I see many businesses botching the elementary steps and ending up with a legal fall-out that costs them time and attorney’s fees. So, after dealing with thousands of situations involving fired employees, here are the TOP THREE tips that an employer will want to follow when firing, to avoid legal trouble down the road:
- Hire Slowly, Fire Quickly. This is an HR mantra, with which I whole-heartedly agree. When I say “quickly,” I don’t mean rush into firing some on on the spot or do so impulsively. What I mean is that once an employee violated a company policy, showed that they are not loyal to the company, began severely underperforming, etc., do not let them stick around for a long period of time before you terminate. Why? Because keeping them around gives them more time to damage the company’s business and to build a case against the company in case they get fired for a legitimate reason.
- Make sure you comply with all federal and state employment laws. Firing someone “quickly” does not mean you need to skip the important step of making sure that the termination is legal and to consult with an attorney, if necessary.
- If you don’t know what laws apply, consult with an attorney or an HR professional or do your own research, but do not procrastinate in getting rid of a bad employee once they showed their colors.
- Document Reasons. A lot of times an employee is underperforming, for example, but there is nothing in their personnel file that documents it. This problem is especially rampant with small to medium-size businesses. Have written documentation in their file. If an employee is habitually late, for example, have a supervisor note in writing – preferably something acknowledged by an employee – when and how many times an employee has been late. If an employee is rude to customers or misses deadlines, have that documented. It can be as simple as an email to an employee stating we’ve received a complaint against you from a customer and that the company expects the employee to fix that behavior. Why? Because when an employee gets fired and claims that they were fired for an illegal reason, for example, an employer can point to the paperwork and show that the employee has been fired for violating company policy, non-performance, or for another legitimate reason.
- Have Paperwork and Witnesses Ready. If you want an employee to sign a severance and release agreement, have one ready to hand to them at the termination meeting. If you want them to sign a form acknowledging that they will return company equipment, have that form ready. Once they walk out, the likelihood of them signing something goes down significantly. Additionally, if you are firing someone via zoom, in person, or on the phone, have a witness with you that can later confirm what was said during the termination.
Conclusion. Follow these simple tips to reduce the likelihood of litigation. Also, follow your gut, and if you think that a particular employee is likely to cause problems for the company, seek legal advice before you terminate the employee. A conversation with a knowledgeable attorney prior to the termination may save you a lot in attorney’s fees if your gut feeling about a trouble employee turns out to be true later and the company ends up facing an EEOC charge, a claim for unemployment benefits, or a lawsuit.
You can find additional tips on how to handle terminations here.
Leiza Dolghih is the founder of Dolghih Law Group PLLC. She is board certified in labor and employment law and has 16+ years of experience in commercial and employment litigation, including trade secrets and non-compete disputes. You can contact her directly at email@example.com or (214) 531-2403.