Termination Checklist

 “Severance”, “job release”, “termination”: no matter what you call it, firing an employee is one of the hardest tasks you face in running your business.

It’s also one of the riskiest, since at least half of the discrimination claims filed with the Equal Employment Opportunity Commission involve discharges, rather than other adverse employment actions such as demotions or failure to hire.

There are many things to consider before you fire an employee. For example, what you call the termination is important. Juries often side with the employee in discrimination suits when the employer just doesn’t say what he means at the time of the termination. It makes the jury distrust a employer who uses corporate double talk such as “job separation” to describe a simple firing.

Newsweek reported in August 1996 that corporations had actually used the following euphemisms during the downsizing craze of the mid-90s: “release of resources” (Bank of America); “career change opportunity” (Clifford of Vermont); “rightsizing the bank” (Harris Bank of Chicago); “strengthening global effectiveness” (Proctor & Gamble); “normal payroll adjustment” (Wal-Mart).

Besides the language that you use to fire an employee, you must be alert for all the legal landmines of termination. To help you navigate the minefield, before you fire an employee you should review this checklist.  While it does not include every issue that may come up following a termination, the checklist does alert you to areas of concern that you should address with your employment attorney or your human resources director before you proceed with the termination.

1.     Does the employee have an oral or written contract of employment?  This could include an offer letter, oral statements made to the employee, such as “we will try you in this position for a year”, or statements or documents indicating the employee is subject to firing only “for cause.”

2.     Does the employee’s personnel file adequately document a problem?

3.     Did the employee commit an act that the Texas Workforce Commission would consider “misconduct” to protect your unemployment tax rate?

4.     Did the employee have fair notice that his or her conduct was unacceptable and an opportunity to correct the situation?

5.     Is the employee over 40 and is the employee being replaced by someone substantially younger than the employee?

6.     Is the employee disabled in any way, including physical or mental handicaps?

7.     Has the employee been injured on the job and/or filed a worker’s compensation claim?

8.     Is this a present sexual harassment situation or have there been claims of sexual harassment involving this employee in the past?

9.     Are your policies or handbook being followed?

10. Is the employee a minority with any possible claim of discrimination?

11. Is the employee a female with any possible claim of discrimination?

12. Is the employee entitled to claim any kind of discrimination based on religion, national origin, ethnicity, or status as a member of the armed forces?

13. Has the employee blown the whistle on any kind of alleged illegal activity of the employer?

14. Does the employee have any pending pension eligibility?

15. Is the employee a member of a union or protected by a collective bargaining agreement?

16. Have you paid the employee all overtime and minimum wages that he is due?

17. Is there a problem with the organization rather than the employee?

18. Is the employee being treated fairly?

19. Have you considered paying a small severance benefit in exchange for a release of all liability from the employee so you don’t have to worry about all of the above?

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