In today’s complex and highly regulated workplace, employee terminations require careful planning, clear communication, and strict adherence to legal and ethical standards. Employers are responsible not only for ensuring that terminations are handled fairly and respectfully, but also for protecting the organization from potential legal challenges. This means understanding applicable laws, maintaining thorough documentation, and addressing performance or conduct issues in a timely, consistent manner. A well-managed termination process safeguards both the company’s integrity and the dignity of the departing employee.
Documentation
Consistent, thorough documentation is your strongest protection against challenges—whether they come from an employee during a termination meeting, the state unemployment insurance department, the Equal Employment Opportunity Commission (EEOC), or opposing counsel in court. Record behavior and performance issues as they occur, along with any disciplinary actions taken and any warnings given about potential consequences if improvements aren’t made. While no set amount of documentation can completely eliminate risk, more is generally better. Aim to create a clear record that demonstrates both a pattern of issues and your good faith efforts to support the employee’s improvement.
Not Relying on At-Will Employment Status
Many employers—especially when documentation is lacking—lean on the principle of at-will employment, which allows termination at any time, with or without notice, and with or without cause. However, numerous exceptions exist. Termination can still be considered wrongful if it’s connected to an employee’s disability, race, sex, religion, age, or other protected characteristic, or if it’s in retaliation for the employee exercising a legal right.
If you choose not to give a clear reason for termination—using vague phrases like “bad fit”—the employee may draw their own conclusions, which could prompt them to seek legal counsel. In contrast, when poor performance has been openly addressed in prior conversations and supported by thorough documentation, employees are less likely to believe the termination is unlawful.
Timeliness
Once a performance or behavioral issue reaches the “final straw,” termination should follow promptly. Acting quickly reduces the risk that the decision will appear arbitrary to outsiders and minimizes the chance that intervening events could make the termination seem retaliatory. For example, if you plan to terminate an employee for repeated timecard falsification but delay three weeks due to a busy season, that window allows the employee to request medical leave, file a harassment complaint, or disclose a disability—any of which could cast doubt on your motives.
Termination Meeting Best Practices
- Hold the meeting in a private location and at a time of day that will allow the employee to make a graceful exit. If the employee is not remote, the meeting should generally be held in person
- Prepare a script or outline for the meeting and stick to it
- Don’t rely on “at-will employment” as the explanation for the termination. When discussing the reasons for the employee’s termination, be honest—don’t exaggerate or minimize the problems. You want the employee to know that you have a valid business reason for their termination
- Present any disciplinary documents, including last chance agreements or performance improvement plans, that are relevant to the termination reason
- Address compensation and benefits details, including the employee’s final pay (date and method), insurance end dates (including any continuation and conversion options), and retirement plan information
- Make sure the employee receives a copy of any required state notices, such as information about unemployment insurance
- Review any post-employment contractual obligations, such as the terms of noncompete or nondisclosure agreements
- Review the process for return of company property, including the date by which all items should be returned
- Let the employee know how future reference checks for employment will be handled, including who those requests should be directed to
- Allow reasonable time for the employee to ask questions and identify who they should contact if they have additional questions after the meeting
The HR professionals at BCN Services are here to help you navigate employee terminations and HR compliance. Contact our team today at 734.994.4100 or [email protected] to learn more about our service model!