Tips Offered To Avoid Lawsuits During Terminations of
At one time or other, every company in the kitchen and bath
industry ends up terminating an employee. In today’s lawsuit-happy
culture, however, many employers are concerned that former
employees may respond with legal action.
While there’s no guaranteed method for avoiding a lawsuit,
employers can take steps to diminish the likelihood that a former
employee will sue. They can also ensure a powerful defense in the
event that a termination is disputed by following a few guidelines,
say human resources experts.
If your employees are union employees, they work under a written
contract, and termination procedures will be spelled out. All other
employees are considered to be employed “at will.”
In an “at will” relationship, either employer or employee can
end the relationship at any time, without notice or cause. In
reality, however, there are some restrictions:
- You may not fire an employee due to his or her gender, race or
national origin. Nor can you fire him or her for a mental or
physical disability that does not affect the employees
- Most states prohibit firing an employee for taking time off to
serve on a jury or testify in court, reporting the company’s health
or safety violations, or reporting abuses of power. You cannot fire
an employee for performing legal activities off-premises (including
membership in a political party or the consumption of legal
substances such as alcohol).
- Many states stipulate that all contracts (including at-will
relationships) carry an implied covenant of good faith and fair
dealing. This means that, although the law allows an employer to
fire an at-will employee without cause, certain terminations that
can be perceived as breaches of faith may provide grounds for
lawsuits. For this reason, it is advisable to fire with cause
whenever possible, and to document poor performance or
disciplinable offenses as they occur.
A work environment governed by fairness and respect is the best
safeguard against potential lawsuits. If your employees feel they
get a fair shake, you’re a lot less likely to get involved in a
lawsuit than when your employees feel you’re unfair or
You can prevent later trouble by establishing principles of
fairness early on. Set up a progressive discipline system to
monitor employee performance and behavior. Design it so that
consequences become more severe if behavior does not improve. This
gives the problem employee the opportunity to make improvements and
prevent further disciplinary action (including dismissal). It also
ensures that if the employee’s performance does not improve, he or
she will be prepared for the consequences.
Certain offenses that qualify as cause for immediate dismissal
need not be subject to the progressive discipline structure (as
long as they’ve been clearly spelled out beforehand). These may
include stealing, using drugs or alcohol on company premises, or
endangering the safety of others.
You should have an explicit written discipline policy
establishing standards of behavior. It should outline the
progressive discipline structure, and spell out any offenses which
will result in immediate termination. All employees should have a
copy, and it should also be verbally explained. This is even more
necessary in small companies than in large ones, since small
companies have less middle management and less supervision.
A good way to ensure fairness and prevent lawsuits is to have
the termination decisions made by consensus, such as by a
disciplinary committee. Moreover, the people making the final
decision should not be involved in a direct conflict with the
There is no easy way to fire an employee. The person must be
treated with compassion, yet it’s essential to give an honest and
thorough account of the reasons for dismissal. You should take a
few considerations into account.
1. Some states require that an employer present the employee
with his or her final paycheck, as well as payment for all unused
vacation and paid time off, at the time of termination. Failure to
comply can result in penalties equaling up to 30 days of the
2. Most experts recommend that companies offer transition
counseling to terminated employees. This counseling provides
information on how to collect unemployment (if applicable), as well
as information on other important resources for job seekers. This
may be handled by the office manager.
3. If you’re firing someone after years of service, it’s best to
offer a severance package. This gesture of support can promote
mutual respect and fair dealing, and decrease the chance of
retaliatory legal action.
4. If you must fire, fire early in the week. This gives the
person fired an early chance to make contact with potential
employers, as well as time to cool off before the weekend.
5. In order to avoid possible allegations of misconduct or
unfair treatment, have a witness present at the firing. You may
also wish to show the employee a document stating the reasons for
the termination, and have him or her sign it.
Many employers are concerned about the effects of terminations
on other employees. If your staff feels a fellow employee’s
termination was unfair, the staff may lose confidence in
management. This could result in an unproductive work
Fortunately, the standards of respect and fairness that protect
employers against lawsuits also help employees to be sympathetic
toward management’s decisions.
No matter how carefully an employer handles a termination,
there’s still a chance that a former employee will initiate legal
proceedings. With some planning, however, a company can greatly
reduce the chance of a lawsuit.