How to Fire an Employee while Protecting Your Business
Sometimes situations arise which make it impossible to continue employing a specific individual. In many circumstances, it’s one of the more difficult aspects of running or managing a business. Yet, when the best interests of your company are on the line, it must be done. Follow the steps below to maintain compliance with the law during the process.
Become Familiar with the Term Employment at Will
In Pennsylvania, employers can adopt an “at-will” policy which allows the employer to terminate an employee at anytime, without a specific reason. It’s critical to work with a business law attorney to be sure your policy falls within the law and protects your business.
UNDERSTAND ILLEGAL REASONS FOR TERMINATION
Even with a solid employment at will policy in place, there are certain situations that are not tolerated under the law. Some examples are:
- Whistleblowing: An employer cannot terminate an employee for reporting illegal activity, or complaining about it.
- When the Employee is Protected By Law: In certain situations, employees are entitled to FMLA leave, military leave or jury duty – among other things. During these periods of leave, you may not terminate the employee.
- Discrimination: An employer cannot generally terminate an employee for reasons relating to age, gender, disability or religion. It’s important to be sure you are not accused of discrimination during the discharge process.
If a performance issue is the reason behind the termination of an employee, it should be documented. This provides further protection to you, as the employer. Issues to document include:
- Poor performance
- Customer complaints
- Formal complaints filed by other employees
- No-shows or tardiness
- Performance reviews
- Disciplinary actions and conversations
By tracking this information, you’ll be prepared to provide documentation that solidifies your case for terminating the employee, should the need arise.
BECOME FAMILIAR WITH BENEFITS AND RIGHTS
When employees are terminated, they are legally entitled to certain rights and benefits in certain circumstances. As the employer, it’s important to be aware of these entitlements prior to taking termination actions. They may include:
- COBRA Health Insurance Coverage
- Unemployment Insurance
- Retirement Plans (vested)
Severance pay is generally not required; instead it is seen as a benefit in certain termination situations. It’s best to create a severance pay procedure that is outlined in your internal documents and is handled consistently in termination situations.
It’s important to note, that even when you’ve taken the proper steps, a lawsuit could still arise. However, when you can provide proof of the steps above that can justify the termination and the way it’s handled, the outcome is more likely to be favorable.
Because lawsuits can arise in any termination situation, it’s best to seek the counsel of an experienced business lawyer, like Attorney Michael Hynum with Hynum Law in Harrisburg, Pennsylvania, prior to taking action. Take the necessary steps today to protect your business tomorrow.