HR Management & Compliance, Learning & Development

Tips for Managing Discharge Risks

Employment decisions can be difficult. Which applicant do we hire? Should we grant this employee’s request for leave? What type of discipline do we impose on a particular worker? Each decision carries varying degrees of risk. One of the riskiest decisions you’ll face will be whether to discharge a particular employee. Before making the decision, and to limit some of the potential risk, here are some important issues to consider and discuss with the termination decisionmakers in your organization.

Have a Good Reason

While many employees are considered to be “at-will employees” (meaning they can be fired for any reason as long as it isn’t illegal or improper), you’ll want to make sure you have a good reason to justify any discharge decision. You shouldn’t rely on the at-will employment doctrine to support your decision.

In other words, if an employee sues you over a discharge, you don’t want to defend the decision by telling the jury you had the right to fire the individual for any reason. Juries will want to hear a proper and fair reason to justify the dismissal.

As a result, when you discharge an employee, you should be able to articulate a legitimate, nondiscriminatory, and nonretaliatory reason. Stating the reason will not only assist your counsel in defending the company but also act as a “check” on your decision.

If you have any trouble articulating a reason that appears to be fair and proper, it should cause you to question the decision and revisit whether it should be made. Discharge decisions are risky endeavors and become even more so if you can’t clearly explain why you terminated an individual’s livelihood.

Does Documentation Support the Reason?

When making your discharge decision, you’ll want to check the documentation to make sure it supports your reason. If the fired employee files a lawsuit against you, her lawyer will be closely reviewing the documentation for anything that calls your stated reason into question.

For example, if you discharge an employee for poor work performance, you should check his past  evaluations to see if they support the decision. Similarly, if you fire an employee after an investigation into a work misconduct issue, do the probe’s notes or interviews support your finding? Documentation that is inconsistent with or directly contradicts your stated reason will make defending the decision very difficult.

How Have We Treated Others?

If you discharge an employee for participating in a specific type of workplace misconduct, you should consider how you’ve treated other employees who have engaged in similar behavior. Treating workers differently who have engaged in similar conduct is difficult to defend and increases the risk your discharge decision won’t hold up if challenged.

One way to help ensure similar decisions are being made for similar misconduct is to get your HR department involved in the termination process. Because your employees may work in different departments under different managers, there could be situations when supervisors make different disciplinary recommendations for employee misconduct:

  • One supervisor may recommend dismissal based on what an employee in Department A did.
  • Meanwhile, a supervisor in Department B may recommend a different level of discipline for an employee there who engaged in the same type of misconduct.

If you don’t have a central HR department involved in the process, it may be difficult to keep track of how and why employees are being disciplined or discharged. A centralized dapproach may help to ensure consistent decisions are being made across the organization.

Seek Advice and ‘Roundtable’ Discharge Decision

Before you carry out the discharge decision, it’s a good idea to talk with your legal counsel, who may be able to alert you to potential legal issues. For instance, your counsel may be able to offer guidance on the employee’s ability to assert a discrimination claim. Further, your counsel may be able to determine the likelihood the individual can file some type of retaliation claim.

Additionally, your legal counsel should be able to offer an outside view of the situation. Sometimes people get entrenched in believing termination is the right decision, and you need a fresh set of eyes to review the situation.

Another way to obtain a fresh viewpoint is by getting together with other managers not involved in the incident and hearing their thoughts on the discharge. They should have experience in the organization and may have valuable historical knowledge to share. Take advantage of their insights to see if they have any issues with the dismissal. While your decision may be delayed, it may be time well spent as you may be able to avoid an outcome you’ll later regret.

Bottom Line

Discharge decisions shouldn’t be taken lightly. They can lead to lawsuits, which can be disruptive to your organization and costly to the bottom line. They also require your employees to spend time meeting with your lawyer and gathering various documents and information. Additional costs can come from having to pay money to settle the lawsuit or, in the worst-case scenario, because the jury has awarded damages to the terminated employee.

While you can’t avoid all lawsuits, you can take the above steps to help limit the amount of risk you’ll face whenever you decide to discharge an employee.

Jeffrey M. Cropp is an attorney with Steptoe & Johnson PLLC in Bridgeport, West Virginia. You can reach him at jeffrey.cropp@steptoe-johnson.com.