5 Keys to Avoiding Wrongful and Discriminatory Termination Claims

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Sep 16, 2014

While most employers would hope to avoid terminating employees, it’s a reality for most at some point.

Whether the business needs to make the decision for financial reasons, or because of performance issues, any termination needs to be handled appropriately to avoid potentially costly consequences.

We are living in an increasingly litigious society, where it has become easier, and seemingly more popular to sue. Even if a lawsuit is not filed, an ex-employee reporting their termination to the EEOC or department of labor could end up being more costly to the business, if found at fault for wrongful termination or discrimination.

5 keys to doing terminations right

Here are a few helpful tips to help keep your business out of harm’s way:

  1. Ask yourself, is termination really the only option? If the termination is for performance issues, could another course of action be taken? Consider working with the employee to correct the issues, or find a different role in the organization that is a better fit. If the termination is based on finances, and a dip in revenue, maybe a reduction in hours could solve the problem.
  2. Make sure it’s not a surprise to the employee. Termination should be the last step in a process where the employee was given an opportunity to improve performance issues. There should be a number of steps including verbal and written warning, and perhaps a performance improvement plan to follow.
  3. Be prepared with specifics. If an employee does not know why they are being terminated, this leaves a lot more room for interpretation and they could make assumptions about why they were let go. It’s best to have clearly documented examples of issues that were addressed in the past.
  4. Don’t do it alone. Termination meetings can become very emotional, on both sides. Having a third person in the room can help diffuse situations and provides a witness to anything said in the meeting.
  5. Provide assistance. Depending on your state and employee size, you will need to provide certain information to your departing employee (COBRA notification, unemployment info, last paycheck etc), but I would recommend taking this a step further in some instances. Helping your employee to find their next job could prove to be a very smart move. The less time spent collecting unemployment benefits, the better for your businesses’ unemployment rate, and less time out of work might mean less time contemplating a wrongful termination claim.

Terminating an employee is never easy, and could become a nightmare for businesses if not handled correctly. If you are unsure if your termination practices are putting you at risk, there are plenty of resources out there to help ranging from online help to HR consultants and attorneys.

This was originally published on the Genesis HR Solutions blog.

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