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Employees who feel they were unjustly dismissed may go to great lengths for vengeance; they may steal secrets, become competitors, or bring lawsuits. You can not afford to wait until it is time to fire someone to take steps to protect your company. 

Commandment 1: Hire carefully! Many employees who are fired should never have been hired in the first place. Even if you are careful in your hiring, always keep in mind that at some point in the future you may have to fire this person. Think about what you are saying and doing from the outset of the employment relationship: do not give up your status as an at-will employer or enter into an employment contract of definite duration. Do not send offer letters quoting annual salaries: quote all rates of pay in the smallest increments of time possible, i.e. hourly or weekly. Avoid any references to guaranteed, lifetime employment, or that the employment relationship will last “as long as work is satisfactory.”

Commandment 2: Carefully review all company handbooks, policies, memos, and letters to make sure they all clearly state that you are an at-will employer and that nothing in any document alters that status. Have all employees sign off on a document indicating that their employment is at will, i.e. of indefinite duration, and that nothing in any document changes that status or creates a contract of employment.

Commandment 3: Establish reasonable standards of conduct for your company and communicate them to your employees in writing in the simplest, most understandable, straightforward manner possible. You can have the most comprehensive, beautifully written handbook in the world stashed away in your file cabinet, but if you have not given it to your employees, you have got nothing. Have your employees sign off on your policy handbook to acknowledge that they have read, understood, and agree to be bound by the rules and regulations you have established, and that failure to abide by the rules can lead to discipline up to and including termination.

Commandment 4: Document, document, document! Paper the files. If there is a discipline problem that needs to be addressed, put it in writing (i.e. chronic tardiness, absenteeism, insubordination, etc.) A good rule of thumb: If there is no paper in the file, the (mis)conduct did not occur. Another good rule of thumb: Don’t put anything in your employees’ personnel files you would not want a jury to see. Be factual, objective, and fair.

Commandment 5: There are five magic words that you should use when warning an employee that he/she is in danger of being terminated: YOUR JOB IS IN JEOPARDY. Put all “job in jeopardy” warnings in writing and ask the employee to sign the warning. If they refuse to do so, try to make sure that there are two of you representing the employer in the disciplinary counseling session.  Then, simply write on the document, “This final warning was given to  (employee name) on June x, 19xx; he refused to sign the document, but is aware that his job is in jeopardy.” Put the document in the employee’s personnel file and be prepared to provide it as evidence if the employee is ultimately fired and files for unemployment benefits.

Commandment 6: If you decide to conduct regular performance evaluations, be honest. Do not engage in “grade inflation” and rate everyone in the company as excellent if they really aren’t. Evaluations are your opportunity to let your employees know what they are doing well, where they need to improve, and what is going to happen if they do not improve. If you are ever sued, all of these documents are discoverable.  Imagine yourself explaining to a jury why an employee who has been evaluated as “excellent” in all categories for the past five years was suddenly fired for substandard performance. Either make performance evaluations work for you, do not do them at all.

Commandment 7: Use progressive discipline. Short of serious criminal activity on your premises, there is almost nothing an employee can do a single time which will amount to work-related misconduct. Let your employees know the stages of your disciplinary policy and follow them.  For example; they will be verbally reprimanded, followed by a written final warning that their job is in jeopardy, followed by termination. There is no federal or state law that requires three written warnings; however, if you have promised three written warnings in your policy handbook, follow your policy. Say what you mean, and mean what you say.

Commandment 8: Appoint one person in your company to be responsible for objectively reviewing the reasons for each and every termination to ensure that your company’s actions are consistent, fair, legal, and in compliance with your policies. If you do decide to have an exit interview, candidly and honestly state the reasons for discharge to the employee face to face. Many employees do not know why they were fired; and decide to sue. Be brief; the less you say, the less you may have to explain down the road. Do not argue and do not try to justify your decision.

Commandment 9: Good manners never go out of style. Preserve the employee’s dignity and confidentiality throughout the termination process. This is not the time to make an example of an employee, no matter how angry you may be. Frequently, it is the manner in which a termination is handled, rather than the termination itself, that leads to litigation. Even if a worker has clearly demonstrated they cannot function as a satisfactory employee, they should still be treated with dignity and respect. Courtesy, common sense, and discretion will go a long way in preventing embarrassment and avoiding emotional distress. Remember: An employee who is treated with respect and dignity during the termination process will be less likely to sue you. Further, courtesy on your part will help you appear “fair” to a jury of 12 average people, most of whom will be employees rather than business owners or managers.

Commandment 10: Monitor all post-employment claims with various state and federal agencies. Make sure that you tell the same story each time you are called upon to explain your actions. Do not destroy your credibility by telling one story to the state unemployment department and an entirely different version of the facts to OSHA, the EPA, the EEOC or any other agencies involved. This is why it is so important to have one individual designated as the person responsible for the final review of all terminations (commandment 8). You want to present your facts consistently and honestly each time you are called upon to do so.

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