A Practice Smart(TM) Feature
By Michael Blum
The most stressful activity for any manager is firing an employee. Akin to a divorce, an employee termination raises so many fears of recrimination—from a blowup in the process to wrongful termination suits—that removing a thorn from the firm’s side can seem overwhelming. But while breaking up is indeed hard to do, there are ways to make the transition smooth and sound, and even to turn it into a positive for the firm.
The decision to fire an employee is a business decision. Rather than letting it gestate and loom on the horizon, you must address it, just as you would any important business decision. Although it can feel emotionally-based, it is important that you base your decision on document facts, assess the situation soberly and conduct any termination in a respectful fashion.
With a business approach, you can assess how much the employee is costing you (financially and/or emotionally) versus how much a termination could cost (reduced productivity, impact on morale, unemployment insurance, public relations) and determine the best method for termination.
But first, consider alternatives. Try to catch the problem at the first signs of a problem. Have you counseled the employee or asked what might be driving the behavior and its impact on the firm. Have you laid out clear performance expectations and provided training or other opportunities for success? What about offering a position better suited to the skills and temperament of the individual? Considering alternatives can prevent the loss of a potential asset and which might serve as strong self-serving evidence in a potential termination suit. And be consistent. Don’t terminate one employee for something the senior partner’s assistant regularly gets away with. Send a message to your workforce that you treat all employees fairly, but that accountability is a non-negotiable job requirement. Let them observe that they would be treated fairly if they ever found themselves in a similar situation. Termination should be the last step in a positive process.
In the best situation, your firm prepared for this event before it even hired the employee. If not, you can start now. An employee handbook explicitly defining what is expected of the employee and what happens when such policies are violated must be provided at hiring, with an acknowledgement receipt in writing. When applicable, a clear At-Will statement should be included; this can give you the ability to cut the cord without explanation. Finally, leading up to the termination, the firm should clearly document the process: verbal and written warnings must both be documented, and employee performance reviews, with clear behavioral goals, provide a strong paper trail. The better the conduct is documented, the less emotional and difficult it will be to make your decision.
After all this, once you’ve decided it’s time, there are several steps to successful termination.
- Preparation. Review your documentation and make sure your decision is fact-based and opportunities for amelioration have failed. Review the situation with the employee’s supervisor. If you are not comfortable with your knowledge of the law, run the situation and your plan by an employment lawyer. Call the EDD and local labor board if you have questions, especially when discrimination concerns are an issue (firing a member of a protected class, firing a whistleblower, etc.). Make sure you are not retaliating.
- Timing. Don’t do it first thing in the morning. Afternoons, when people are attending to their work and there is less time for employee scuttle about the termination, are best. Give the employee ample time to clear their space. Don’t create drama and embarrassment in the unnecessarily escorting the person and their belongs from your office – As to days of the week, consider Thursday or Friday. Thursday gives other employees one day to process it; Friday gives you the ability to start fresh on Monday. And never do it before the holiday party.
- Location. Behind closed doors. If the employee has her own office, you can give notice there, especially if you are concerned about theft. On the other hand, it’s better to do it in your own office where you feel most comfortable. And whenever possible, have a partner there to be witness the experience and make it less dramatic.
- Demeanor. Stay clam. Don’t raise your voice and become argumentative or confrontational. Don’t make excuses.
- Concision. Be concise and clear. Base it on specific facts and the need to be in line with the firms’ goals. Don’t drag this out. Explain what the employee needs to do (you need to clear out your desk) and how the final paycheck and benefits will be handled—especially COBRA. Ask for any keys or data materials the employee has. Get the check ready to give it to the employee to make it clean and quick.
- Informing other employees. Taking the time to inform them can show that the firm understands how a sudden change in the employee landscape can be difficult and disconcerting for them. Make the announcement after the employee has left, most likely the next business day. Remember privacy is essential. Don’t join in the rumors. Be concise, supportive and do not attempt to justify your action (most of the employees with have concluded for themselves what the problems were). “Unfortunately, we had to let Tom go. We really value you here and will help you in whatever way we can to have you be successful.” Let it go at that.
- An outside gun. Calling in an outside party is designed to reduce your stress and make the termination less personal. With a temperamental employee, whom you personally would rather avoid, it can often serve everyone by having someone from outside the firm come in and do the termination – especially for a senior attorney or salaried class employee. In such a situation, you do not have to experience the stress of the termination and the employee has no emotional tie to the outside party.
- Severance Pay and Release of Claims. Some firms mitigate the possibility of wrongful termination suits by offering severance pay in exchange for a signed release of claims. The release should be reviewed by a seasoned attorney in the field to ensure it adheres to the law. Fundamentally, it must be clearly written, in non-legalese, and restricted to incidents in the past (not the future). Best practices encourage, and in some cases it is required, that the employee to talk with an attorney before signing the document, have a pre-signing consideration period, and be provided with a post-signing consideration period after submitting the signed release. And in many states, a release in this context exempts certain protected claims (age, wage, etc.). Though offering this arrangement may signal to an employee they have a potential case, most employees would rather forego a legal battle and take the money instead. Some firms offer severance with out the requirement of signing a release. In any event, make sure you know the law that applies to your situation.
The Crisis Termination. A situation such as workplace violence may require immediate termination and removal of the employee from the office. Even so, if possible, consult your attorney first—at the very least to get a second opinion. But when it comes to taking care of your staff and yourself, the law respects a clean and clear termination. Try however, to retain whatever property you might need that the employee possesses (office keys or data) before the termination and prepare to reset passwords and security codes. At – will comes in handy here. If you need a security guard, hire one. Checks can be mailed.
Despite the discomfort, dismissing an employee can be one of the most important tasks you perform for your firm. Done incorrectly it can be a disaster for morale, creating a climate of apprehension, secrecy and disrespect. Done correctly it provides you with the opportunity to create or enhance a culture of accountability, fairness, trust and respect, which are the backbone of an efficient and successful firm.
Practice Smart(TM) Features are a service of Michael Blum and Appeal Funding Partners, LLC. The Features are thoughts from a variety of sources on our practices, on being trial lawyers and things of importance to trial lawyers and their clients.
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