How to Fire an Employee

Firing an employee is never a pleasant task. Yet it is a normal part of any business’ operations whether a national corporation or a small San Diego business. Learning the best way to fire an employee begins with an understanding of the employment relationship. Most San Diego business owners understand that employment in California is presumed to be “at-will” (employees may be terminated for any reason or for no reason at all, also termed “without cause”). If a business can fire any employee it wants any time for any reason, then why bother writing an article on how to fire employees? It sounds easy enough. Putting aside the moral hesitation associated with depriving someone of their livelihood, many business owners remain reluctant to fire an employee without first consulting with a business attorney for fear of being sued for wrongful termination. Although employers are permitted to fire at-will employees without any stated reason, there are legitimate concerns employers should consider before doing so.

949108_untitled.jpgFirst, laws against discrimination and retaliation subject employers to considerable risk. Even an at-will employee cannot be fired because if his age, gender, race, sexual orientation, physical limitations, marital status or religion. To do so is illegal. It is also illegal to fire an employee, at-will or otherwise, in retaliation for seeking redress. The risks of these types of claims are significant. Employers that follow consistent termination procedures and provide reasons for termination, whether for cause or for other business reasons, reduce their risk that discrimination claims will be successful.

Second, an employer may be wrong about the employee’s at-will status. In some cases, the answer is obvious. The employee has a written contract. However, in cases where employee manuals and historical procedures are in place that evidence a good cause requirement for termination, courts may infer that an employee is not at-will (that an implied contract exists). In essence, the employee is permitted to rely on the employer’s written policies and historical practices. Offer letters, employment applications and employee manuals that emphasize at-will status reduces uncertainty in this area. Nonetheless, a consistent termination policy is recommended. In addition to reducing the risk of successful wrongful termination claims, a consistent termination policy signifies to other employees that they can expect to be treated fairly.

A termination policy typically includes procedures for progressive discipline and documentation of employee actions. Consistent and progressive disciplinary procedures require open lines of communication and provide employees with an opportunity to correct their ways. The procedures themselves show fairness and document the employer’s reasons for termination. With a consistent termination policy and a basic understanding of at-will employment, the employer is better equipped to handle the ultimate task of firing an employee.

So back to the original question: how do you fire an employee? The steps are relatively simple (assuming there have been no violations of labor laws).

1.    Ensure that internal procedures have been followed including progressive disciplinary actions and that all prior communications and disciplinary actions are documented.  Remember consistency is important.  If an older gentleman is being fired, it will be harder for him to claim age discrimination if the three prior fired employees went through the exact same process.  If an employment contract is in play, be sure that the reasons for termination are allowable grounds under the contract.  

2.    When the time comes to fire the employee, schedule a private termination meeting the same day as termination and have a witness attend (preferably someone in management or human resources).  

3.    Be compassionate and professional, but be direct.  Do not engage the employee in a back and forth discussion giving the impression that there is something the employee can do to change your mind.  Start by tell them your decision.  Follow up with the reasons and the supporting documentation.  Keep the conversation short and although it is tempting to soft shoe around the real reasons, be honest.  It is actually kinder to be direct and honest rather than leading an employee into thinking they should be defending themselves.  If termination policies were followed, the employee is likely expecting the news anyway.  

4.    Be ready for the employee’s immediate departure after the meeting.  If possible, have an attorney or human resource professional assist with the drafting of a termination letter, the preparation of final pay checks and an explanation of COBRA and other benefits.  It is also best to have someone standing by to supervise the employee’s removal of personal items from his office or cubical, return of keys, pass cards, company credit cards and other company property, and to escort the employee from the premises.  It’s important to maintain professionalism throughout the process.  

5.    Finally, consider changing passwords that might provide access to sensitive information off site.

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