Business Insurance

How to prevent wrongful termination lawsuits in your company

Sometimes you need to fire people. It happens within every company. It may be because the employee consistently causes problems, or it may be for financial reasons. Either way, it's not a comfortable situation to be in. Emotions run high. Losing a job could be a devastating blow to an employee, and when they feel that they were wrongfully fired they could bring charges against your company.

There's the right way and a wrong way to fire an employee, and leaving someone out within the cold with no given reason is generally not the best way to go. To avoid being on the chopping block of the wrongful termination suit, there are a few things you have to keep in mind and a few employment practices you can implement.

General best practices for a business.

Your company must have some ground rules laid out for employees. Your policies should be clear and promote a safe, healthy work environment. Some of the areas you'll want to address in your policies are harassment, retaliation, and general expectations for behavior. Additionally you need to have a system in position for performance evaluations, along with a plan for what will be done if someone's performance isn't up to scratch. It's also wise to include an overview of what consequences will be faced if the policies aren't followed.

Do not underestimate the importance of this book. It’s crucial.

Before you begin issuing your handbook, you might wish to seek out some legal advice to make certain that it's fair and, well, lawful. The purpose of an employee handbook is to jot down all the policies you created for the business. Your employees can't stick to the rules if they don't understand what they're.

When you issue your handbook, ensure that you have people sign to exhibit that they received their copy. Hold onto the autographs that you collect.

Some of the expectations you'll want to include in your employee handbook are:

  • Your policy on family medical leave.
  • Required attire/dress code.
  • Hours for that job.
  • What kind of compensation you offer.
  • Your harassment policy.
  • An employment-at-will statement (stating that either the employee or the employer can terminate employment anytime).

Keep notes and records of everything. Make sure that your employees' files are up-to-date and include performance evaluations and reports of any incidents.

It's important to have detailed files for those employees. You need to show that everyone is held accountable to the same rules.

If you have to discipline someone-

Termination shouldn't be the go-to answer when an employee doesn't meet your expectations. If an issue arises, you can take disciplinary action instead. Usually, you might help the employee fix the problem, and this really is more good for all involved than a termination.

There really are a few items to bear in mind for disciplining employees.

You have to consider the suspected issue.

Hold an impartial investigation of the employee's behavior so you have the facts.

You have to discuss the problem with the employee so they're aware that they need to address the issue. Be sure to allow them to have their say, too-it won't help if you do not let them obtain a word in edgewise.

Make sure that the employee is aware of what could happen if they don't correct the issue. Tell them exactly what the next steps are.

The disciplinary action that you've taken must be written out. Possess the employee sign saying that the message has been received. Remember to provide them a copy, too.

If you see improvements, be sure to let the employee realize that their efforts haven't gone unnoticed.

If you reach the decision to terminate the employee-

As with disciplinary action, you have to conduct an investigation before you terminate an employee. Be impartial and stay with the facts. Review the written records of witness reports and statements in the employee. After you've done your due diligence, you can make an informed decision about firing the employee.

When you're faced with having to terminate someone, there are a few stuff you need to do before you set the meeting:

  • Gather any relevant paperwork.
  • If you have any security concerns, make sure that you address them within an inconspicuous way (having burly security guards standing within the corner probably won't help anything.)
  • Choose your location wisely-you don't wish to hold the meeting inside a place that's intimidating.
  • Don't go it alone. Make certain you have an HR rep at the meeting.

During the meeting, ensure that you give a very clear explanation for terminating the employee. If you are firing the employee on the grounds of their performance, you have to be sure that everyone in your company is being held to the same standards. If the employee can show that other people who committed exactly the same offense weren't penalized, it could be a strike against you. If the main reason for termination is financial, make certain the employee understands why they are being let go.

Your tone and attitude also make a difference. Show the employee respect. Be polite. Don't embarrass or shame them.

After the meeting, ensure that the employee hasn't be a source of ridicule round the office. Malicious social media postings from anyone within your organization could open you up to liability, so be sure that no one is trash-talking the employee who has been fired. It might return to bite you. You should also ensure that you aren't doing anything to hurt the employee's chances of employment elsewhere-if someone calls for a reference check, kindly divert the request to HR.

Firing people is not fun. It's awkward and uncomfortable to tell someone that you've decided to end their employment together with your company. To avoid a major wrongful termination lawsuit, ensure that you've got the best policies in place to handle firing someone or letting someone go. Do the task right.

Employment practices liability insurance can help you if you're faced with a wrongful termination lawsuit. EPLI would cover the legal costs of such a debacle. If you're thinking about learning more about EPLI, e mail us today! We can even get you a free quote.

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