California is an at-will employment state, which means an employer can terminate an employee with or without cause and with or without advance notice, as long as the reason for the termination is not prohibited by law. If an employer violates any laws, they could be brought to court for wrongful termination. Terminations that are prohibited by law mostly revolve around discrimination and retaliation.

While an at-will employee can be terminated for any reason that’s non-discriminatory or retaliatory, there are often ways an employer can plan ahead for a smoother termination. Mistakes are often made, but many wrongful termination mishaps can be avoided with a little planning and knowledge. Here are the common mistakes employers should be aware of to avoid wrongful termination lawsuits.

1. Not Having Documentation or Conducting a Proper Investigation

It is important to document poor performance or problem behavior. Make sure the documentation is based on prior understood performance goals and expected company policies for behavior. The purpose is to have an objective trail of documentation over time that supports any potential termination. Also, it is important to properly investigate the facts on which the termination is based, including the employee’s side of the story.

2. Not Examining the Employee File Prior to Termination

It is imperative to examine all employee documents before termination (i.e. contracts, union contracts, and performance reviews). This makes sure the employer is following all necessary termination procedures if the employee is under contract.

One of our nonprofit clients terminated an employee and didn’t realize the employee never signed the employee handbook, arbitration agreement, or employment agreement. The employee turned around and sued for wrongful termination. Had the employee signed the employee handbook, the arbitration agreement, or even the employment agreement, the employer would have been in a much better position.

3. Not Providing a Clear, Concise, and Consistent Reason for Termination

It is important to provide a clear and short reason for the termination. Make sure that your reasons for termination are not discriminatory or retaliatory. When meeting the employee, do not apologize or provide too much information. Rather, keep it short and clear why the employee is being terminated. It may be advisable to have a witness at the termination meeting.

Be consistent in your explanations for the employee termination in all paperwork. This includes any paperwork for HR, workers comp, or for any paperwork that may lead to litigation. Additionally, an employer should refrain from talking about the terminated employee internally or externally. Rather, simply state the employee has left and that it is a confidential employment situation.

4. Not Being Compassionate

Be courteous and compassionate during the termination meeting. Allow a terminated employee a graceful exit to the extent possible. Provide employee time and assistance in removing their belongings from the office. Also, consider allowing the terminated employee to submit a letter of resignation. This removes the stigma of being fired and makes it easier for the employee to find other work. In addition, depending on the employee, it may be good to provide a 3rd party service that will assist the employee in finding new employment.

5. Not Paying Monies Due to the Employee

Timely pay all monies due to the employee. Have a check at the termination meeting if possible. Also, an employer may want to consider whether severance pay should be paid to reduce risk. If an employer is not required to pay severance, it may be worth paying some severance in exchange for a release where there is a risk of a claim.

In one example, one of our clients, a manufacturing company with over 100 employees, forgot to calculate 3 hours of pay on a final paycheck stub. The penalties owed from this mathematical error ended up costing the company $1,045 rather than $45, had the correct amount been paid.

6. Not Taking Back Business Property or Terminating Employee Access

An employer must terminate employees’ access to the business. This includes taking back keys, key cards, credit cards, company property, email, change passwords, etc. If an employee was a co-signatory for a business account, this must also be changed.

7. Not Seeking Assistance from an Attorney

In many cases, it may not be necessary to seek attorney assistance on termination because there isn’t much risk, and in many cases, the employee is not surprised. There are, however, many cases where a conversation with an employment attorney would be advisable to avoid wrongul termination suits.

If you feel that you need assistance with an employment law matter, please contact Hackler Flynn and Associates.

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DISCLAIMER: Content within this post should not be considered legal advice and is for informational purposes only. Communications made through this post do not create an attorney-client relationship. Hackler Flynn & Associates is not responsible for any content that you may access from third-party resources that may be accessed through or linked to this post. Hackler Flynn & Associates is only licensed to practice in California.

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