How an employer handles firing or laying off an employee on the front end can make all the difference imaginable on how the separation of employment actually takes place. A well executed, carefully planned employee termination can avoid any serious stir in the workplace. A poorly executed, shoot-from-the-hip approach, on the other hand, can cost an employer dearly in terms of productivity and morale, as well as financially when the ex-employee fires back with a lawsuit.

Mastering HR: Firings and Terminations

Properly preparing for firing an employee starts with getting the paperwork in order – look at performance evaluations, disciplinary action forms, attendance sheets, etc., and make sure that the documentation shows that a case can be built that supports a proper reason to fire the employee. Documentation is important in helping make the decision in the first place but, more critically, it serves to back up the decision should the fired employee file a lawsuit.

Consistency in the documentation is key. Harmony between the employer’s reason for why the firing took place and the documentation on the employee’s work history can mean the difference between a simple parting of ways and a prolonged and messy legal battle, and employment attorneys know this. If an ex-employee’s lawyer, looking for evidence of a wrongful termination, sees a lack of consistency in the employee’s personnel files or a lack or records at all, employers should consider that blood on the water.

HR Guide to Employment Law: A practical compliance reference manual covering 14 topics, including firing

Protected classes of employees
Another very important consideration is whether an employee slated for possible termination is a member of a protected class. Federal law prohibits discrimination based on a number of factors such as race, color, religion, national origin, sex, pregnancy, age, disability, or citizenship.

State and local laws also can provide additional protection to employees. For example, no federal law currently protects against discrimination based on sexual orientation but a large number of states do.

State-by-state comparison of 50 employment laws in all 50 states, including sexual orientation discrimination, final paycheck, unemployment compensation, and noncompete agreements

Below is a list of the major employment laws which create protected status for certain employees:

• Americans with Disabilities Act (ADA) and the ADA Amendments Act (prohibits discrimination because of a job applicants or employees disability)
• Age Discrimination in Employment Act (ADEA) (prohibits discrimination based on age)
• Title VII of the Civil Rights Act of 1964 (prohibits discrimination based on several different characteristics)
• Civil Rights Act of 1866, Section 1981 (prohibits discrimination because of race in contracts)
• COBRA (federal law regarding health insurance coverage continuation)
• Employee Retirement Income Security Act (ERISA) (prohibits discrimination in employee retirement plans)
• Fair Labor Standards Act (FLSA) (federal law regarding wage and hour issues)
• Family and Medical Leave Act (FMLA) (federal law providing job-protected family and medical leave)
• National Labor Relations Act (NLRA) (federal law governing labor relations)
• Occupational Safety and Health Act (OSHA) (federal law regarding workplace health and safety)
• Older Workers Benefit Protection Act (OWPBA) (protects older workers benefits from age discrimination)
• Pregnancy Discrimination Act (PDA) (prohibits discrimination based on pregnancy, childbirth or related conditions)
• Rehabilitation Act
• Sarbanes-Oxley Act (protects workers who are whistleblowers)
• Uniformed Services Employment and Reemployment Rights Act (USERRA) (prohibits discrimination against members of the armed forces)
• Worker Adjustment and Retraining Notification Act (WARN Act) (layoff notification law)

Basic Training for Supervisors – easy-to-read training guides, including firing

Other considerations
Terminating an employee can lead to a number of other important issues. As every human resources professional knows, just because an employee no longer works for an employer it doesn’t mean that all ties have been severed completely.

HRHero White Paper: Combating Workplace Violence

Unemployment compensation is one such issue that can leave the specter of a former employee haunting an HR pro’s office long after the employee was fired. Again, having good documentation that shows the employee was fired for misconduct can be critical in an unemployment compensation hearing. Winning in these hearings can save an employer big bucks in the long run.

COBRA and severance pay are two more issues that must be dealt with. By law, an employer must make an employee aware of his rights under COBRA for continuing to stay on the company’s health insurance program. Severance pay arrangements can offer some peace of mind for employers that the ex-employee won’t sue, but at a hefty price. Yet, putting a severance pay agreement in front of an employee who is being fired or laid off isn’t always a solid insurance policy against a lawsuit. If an exiting employee feels that he is leaving on bad terms, even the heftiest of severance sums may inspire him to use if he sees it as the company’s attempt to cover up indiscretions.

Benefits Complete Compliance – comprehensive online management reference service and reference manual