A vast majority of business owners or managers will say that terminating employees is the hardest part of the job. Even under the most business-like of circumstances where laying off staff was necessary, it can be emotional and unpleasant. This can then be followed by an expensive and time-consuming wrongful termination suit.
Employers can help themselves and their legal team by preparing for the termination ahead of time, rather than having to backtrack after the fact. While the circumstances of each situation are different, some helpful strategies include:
Review all available documentation: The employer and an employment attorney should gather all relevant documentation about the employee’s work history, employment agreement, other agreements (such as stock options).
Assess litigation risk: When review documents, it is wise to evaluate litigation potential where an employee could allege sexual harassment, discrimination or other illegal actions.
Evaluate costs: Try to determine what the actual or potential cost to the company in paying benefits, compensation, commissions, options, or equity. In the case of contract employees, it is essential to determine if there is liability tied to the circumstances of the dismissal.
Other consequences: This could mean other employees following the dismissed employee to start a new company or likewise file suits. It is also smart to consider the damage to the morale of employees who remain with the company.
Create a severance package: This can sidestep the likelihood of litigation, negative publicity and may be less costly. It may also suggest good intentions and elicit goodwill for the employer.
What will the plaintiffs seek?
A legal team must be prepared for whatever the plaintiff alleges. Potential areas of exposure for the employer include:
- Loss of income: The employee may seek past and future earnings, although they must first try to find similar work opportunities.
- Emotional distress: The employee may also claim that there are embarrassment, anxiety and depression due to the termination and its circumstances.
Attorneys can often resolve these matters
An experienced employment law attorney can provide useful insight into these matters. Under their guidance, an attorney can draft a handbook with all the appropriate protocols and policies to avoid such disputes. They can also handle all the details of these matters so the employer can focus their business.