Commandment I
Hire carefully! Many employees who are fired should
have never been hired in the first place. The key to a successful (and,
hopefully, litigation free) termination begins at the time of hire. Think about
what you're saying and doing from the outset of the employment relationship: do
NOT give up your status as an at-will employer or enter into an employment
contract of definite duration. Do not send offer letters quoting annual
salaries; quote all rates of pay in the smallest increments of time possible,
i.e., hourly or weekly. Avoid any references to guaranteed, lifetime employment,
or that the employment relationship will last "as long as work is
satisfactory."
Commandment II
Carefully review all company handbooks, policies,
memos, and letters to make sure that all clearly state that you are an at-will
employer and that nothing in any document alters that status. Have all employees
sign off on a document indicating that their employment is at will, i.e., of
indefinite duration, and that nothing in any document changes that status or
creates a contract of employment.
Commandment III
Establish reasonable standards of conduct for your
company and communicate them to your employees in writing in the simplest, most
understandable, straightforward manner possible. You can have the most
comprehensive, beautifully written handbook in the world stashed away in your
file cabinet, but if you haven't given it to your employees, you've got nothing.
Have your employees sign off on your policy handbook to acknowledge that they
have read, understood, and agree to be bound by the rules and regulations you
have established, and that failure to abide by the rules can lead to discipline
up to and including termination.
Commandment IV
Document, document, document! Paper the files. If
there is a discipline problem that needs to be addressed, put it in writing
(i.e., chronic tardiness, absenteeism, insubordination, etc.). A good rule of
thumb: if there is no paper in the file, the (mis)conduct did not occur. Another
good rule of thumb: don't put anything in your employees' personnel files you
wouldn't want a jury to see. Be factual, objective, and fair.
Commandment V
There are five magic words that you should use when
warning an employee that he or she is in danger of being terminated: YOUR JOB IS
IN JEOPARDY. Put all "job in jeopardy" warnings in writing and ask the
employee to sign the warning. If they refuse to do so, try to make sure that
there are two of you representing the employer in the disciplinary counseling
session; simply write on the document, "This final warning was given to
John Doe on June X, l9XX; he refused to sign the document, but he is aware that
his job is in jeopardy." Put the document in the employee's personnel file
and be prepared to provide it as evidence if the employee is ultimately fired
and files for unemployment benefits with the Texas Workforce Commission.
Commandment VI
If you decide to conduct regular performance
evaluations, be honest. Do not engage in "grade inflation" and rate
everyone in the company as excellent if they really aren't. Evaluations are your
opportunity to let your employees know what they're doing well, where they need
to improve, and what's going to happen if they don't. If you are ever sued, all
of these documents are discoverable. Imagine yourself explaining to a jury why
an employee who has been evaluated as "excellent" in all categories
for the past five years was suddenly fired for substandard performance. Either
make performance evaluations work for you, or don't do them at all.
Commandment VII
Use progressive discipline. Short of serious
criminal activity on your premises, there is almost nothing an employee can do a
single time which will amount to work-related misconduct. Let your employees
know the stages of your disciplinary policy and follow them (i.e., they'll be
verbally reprimanded, followed by a written final warning that their job is in
jeopardy, followed by termination). There is no federal or state law that
requires three written warnings; however, if you have promised three written
warnings in your policy handbook, certainly follow your policy. Say what you
mean, and mean what you say.
Commandment VIII
Appoint a "czar" or "czarina"
of discharges who will objectively review the reasons for each and every
termination to ensure that your company's actions are consistent, fair, legal,
and in compliance with your policies. If you do decide to have an exit
interview, candidly and honestly state the reasons for discharge to the employee
face to face. Many employees don't know why they were fired, and decide to sue.
Be brief: the less you say, the less you may have to explain down the road.
Don't argue and don't try to justify your decision.
Commandment IX
Good manners never go out of style. Preserve the
employee's dignity and confidentiality throughout the termination process. This
is not the time to make an example of an employee, no matter how angry you may
be. Frequently, it is the manner in which a termination is handled, rather than
the termination itself, that leads to litigation. Even if a worker has clearly
demonstrated they cannot function as a satisfactory employee, they should still
be treated with dignity and respect.
Courtesy, common sense, and discretion will go a long way in preventing
embarrassment and avoiding emotional distress. Remember: an employee who is
treated with respect and dignity during the termination process will be less
likely to sue you; further, courtesy on your part will help you appear
"fair" to a jury of 12 average people, most of whom will be employees
rather than business owners or managers.
Commandment X
Monitor all post-employment claims with various state
and federal agencies. Make sure that you tell the same story each time you are
called upon to explain your actions. Don't destroy your credibility by telling
one story to the Texas Workforce Commission and an entirely different version of
the facts to OSHA, the EPA, the EEOC, or the Texas Commission on Human Rights.
This is why it is so important to have one individual designated as czar(ina) of
termination: you want to present your facts consistently and honestly each time
you are called upon to do so.
This article by Renee M. Miller, Legal Counsel to Texas Workforce
Commission Chairman Bill Hammond, previously appeared in TWC's Texas Business
Today quarterly publication.