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Robert C. Boisvert

Robert C. Boisvert, Jr. Employment & Labor

rboisvert@fredlaw.com
612.492.7101
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Sure-Fire Firing Mistakes

By: ROBERT C. BOISVERT, JR.

October 2003

Why do some terminations result in litigation while others do not? It is not just luck. Common employer mistakes - made during the decision-making process or while terminating an employee - can result in costly lawsuits and large verdicts against employers.

Breaking Promises

Broken promises breed lawsuits. If an employee feels lied to, he or she may sue for breach of contract, promissory estoppel, or discrimination. And contracts are easy to create. All it takes is a definite promise - oral or written - communicated to the employee. The employee's continued employment seals the deal.

The most dangerous promises are those that undermine the employer's right to terminate employees "at will." "At will" means the employer or employee can terminate the employment relationship at any time, with or without cause or notice. Employers should protect this right by informing employees in writing that either party is free to end the employment relationship at any time, for any or no reason. In addition, employers should not promise in handbooks, offer letters, or elsewhere, that they will terminate only for "just cause," use progressive discipline, or fire only for certain offenses. Employers also should train supervisors to be careful what they say and promise.

Failing to Warn and Document

Employers should promptly warn an employee in writing of any performance or discipline issue that could result in termination. If not, the employee will be surprised when he or she is fired, and surprised employees sue.

The employer that fails to document will have a difficult time defending against a lawsuit. Juries distrust employers and expect them to counsel and warn employees before firing them. Juries have little sympathy for employers who fire without warning and without written proof to support their story.

The Problem with Inconsistency

Most discrimination lawsuits are based on an employee's belief that he or she was treated differently because of sex, race, or other protected class status. An employer that does not consistently apply its policies will increase the risk of discrimination claims.

In Minnesota, it is unlawful for an employer to discriminate based on race, color, creed, religion, national origin, sex (including pregnancy, childbirth, or related medical conditions), marital status, status with regard to public assistance, disability, sexual orientation, age, or membership or activity in a local anti-discrimination commission.

While it is always wise to be consistent and follow good personnel practices, it is particularly critical if the employee is in one or more of these protected classes. As a general rule, an employer's response to a particular problem should be consistent with its policies and responses to prior, comparable situations.

Beware of the Rash Termination

It is seldom a good idea to fire an employee on the spot. Precipitous terminations are influenced by emotion and not reason. The employer likely is acting on incomplete or inaccurate information and, therefore, is prone to overlooking legal requirements and making a bad decision.

Instead, an employer should investigate before deciding to terminate. If necessary, the employer may suspend the employee while it investigates. Before terminating the employee, the employer should have a neutral officer, human resources professional, or legal counsel review the facts and proposed decision.

Bad Timing Kills

In employment, as in comedy, timing is everything. Terminating an employee soon after the employee complains of discrimination or other unlawful conduct will lead an employee, and likely a court, to conclude the firing was in retaliation for the employee exercising his or her legally-protected rights. On the other hand, waiting too long to fire an employee may undermine the termination and increase the chance of intervening complications.

To avoid these risks, employers should prohibit retaliation against employees who exercise legally-protected rights. Employers also should train supervisors to be sensitive to the appearance of retaliation so supervisors understand how their actions could be perceived as retaliatory even if they are not. Having proposed terminations reviewed by a neutral officer, human resources professional, or legal counsel also helps reduce the potential for retaliation claims. Finally, if a retaliation claim is likely, the employer should consider alternatives, including forgoing termination.

The employer should take the time necessary when deciding to terminate so it is confident it is making the right decision. Once the employer decides to terminate, however, it should do so as soon as possible.

Not Walking in the Employee's Shoes

Employees who are treated shabbily sue. The following actions look bad to employee and jury alike and increase the risk of a lawsuit:

  • Not giving the employee a chance to tell his or her side of the story when investigating allegations that could result in termination.
  • Firing a long-term employee without coaching or documentation.
  • Firing before a holiday or during a holiday season.
  • Hiring a replacement behind the employee's back or, worse, having the departing employee train his/her replacement.
  • Escorting the employee out, especially in an obvious or heavy-handed manner.
  • Not letting the employee gather personal belongings.
  • Discussing unnecessarily, especially with co-workers, the reasons for termination.
  • Deducting from or withholding the employee's final paycheck.
  • Badmouthing the employee, especially to references.

Employers should treat terminated employees with dignity and follow good personnel practices, including coaching, documenting, and investigating. Employers also should consider any extenuating circumstances, including whether the employee's actions were excusable or misunderstood and whether the employer or supervisor contributed to the problem.

The employer should consider how the employee will view the termination and take steps to soften the blow. These include:

  • Personally deliver the news.
  • Do not lie or sugar coat the reasons, but do not rub them in, either.
  • Do not tell the employee this is difficult for you, too. The employee would gladly trade places.
  • Do not say the decision is "for the best."
  • Consider offering outplacement and paying severance in exchange for a release of claims.
  • Do not talk about the former employee or reasons for termination.
  • Do not withhold or deduct from the employee's final paycheck.

Severance for a Release

Desperate employees sue, and fired employees are often desperate. Terminated employees may sue for money, revenge, vindication, or all of the above.

Unless the employer has promised severance pay by contract, written policy, or well-established practice, there is no obligation to pay it. Still, employers should seriously consider offering terminated employees severance in exchange for a full release of claims. The severance enables the former employee to move on, while the release protects the employer against most legal claims. To ensure enforceability of the release, employers should first consult with counsel.

No amount of magic or luck can make terminations easy and risk free. But avoiding these sure-fire firing mistakes can help employers avoid the courtroom.