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How to Fire an Employee Legally – Reasons & Laws

By Miranda Marquit

fired employee woman“You’re fired!” No one likes to hear those words. And it’s not very fun to say them, either.

You probably won’t tell someone they’ve lost a job the way Donald Trump does it on his TV show, but it seems like it would be a lot easier if you could just say those words and leave the room.

Terminating someone’s job, though, requires a little more compassion, finesse, and explanation.

If you are ever called upon to tell someone they’ve lost a job, here are some things to consider.

Reasons for Firing an Employee

Some legitimate reasons for firing someone include:

  • Poor performance/productivity problems
  • Gross misconduct/unprofessionalism at work
  • Stealing
  • General layoffs

Terminating an employee because of gender, race, religion, marital status, or age is illegal. Additionally, firing someone for personal reasons, without any valid reason to back up your decision, will likely result in a wrongful termination lawsuit. Employers must always have a legal reason for firing employees.

Employment Laws Regarding Termination

It is vital that you know federal laws pertaining to the termination of an employee. Beginning with the Termination topic page on the Department of Labor website, find information about equal employment opportunity requirements, laws related to firing whistle blowers, and other information about how to properly terminate an employee.

In addition to understanding federal law, you will also need to know job termination laws for your state. Before you fire anyone or engage in your first round of layoffs, make sure you are in compliance with state and federal laws. If you have an HR department, your human resources representatives should have steps in place for how the termination process should be followed.

If you do not have an HR department, you will need to be fully versed in the laws regarding termination. An HR consultant can provide useful help, tips, and information about laws related to employee termination for you and members of your management team.

Warning the Employee

Make sure that you cover the consequences or actions that could result in job termination in the employee handbook during employee orientation. Have each employee sign a document stating that they understand company expectations and that they understand the reasons for job termination outlined in the company handbook. Additionally, some companies have employees sign a code of conduct.

Poor performance

If employees are being fired for poor performance, you should warn them ahead of time that their work habits are not up to par. In some cases, you might want to provide feedback on what needs to be done to bring the employees’ performance in line with expectations. If these measurable goals are not met, then you might decide to terminate employees. If someone is fired due to performance, it is imperative to have a paper trail of performance reviews and printed warnings at the time of job termination.

Productivity issues

A warning is also usually needed before you fire someone for productivity issues. If an employee spends a great deal of time on personal calls, checking social media or sending long, unnecessary emails, you can note this on performance reviews, and ask that the employee reduce the amount of time spent on these unproductive activities.

Depending on applicable laws, you will likely have to inform your employees that you are monitoring their computer use, or their phone use, before you can use information gleaned from these activities as grounds for termination. A computer and phone policy, that explains company email, website usage, and phone calls made on company time may be monitored, should be addressed with new hires in employee orientation.

Gross misconduct

In the case of gross misconduct, such as sexual harassment, violation of a no-dating policy at work, verbal abuse, hate speech directed at employees or clients, or physical harm of another employee or a client, you can usually consider an employee warned if you covered the consequences (including termination) during employee orientation.

The same goes for stealing. It goes without saying that stealing won’t be tolerated in a work setting. However, it is generally a good idea to make sure that the consequences of these actions are covered during orientation.

Layoffs

In some cases, employers should warn employees about possible termination. For example, some companies announce, two to six weeks ahead of time, that they will be laying off workers. This gives some workers the chance to take early retirement, as well as renew their contacts and update their resumes.

Thus, if you know that layoffs are inevitable, consider providing employees with an advance warning. You might also consider offering to pay for professional resume services, providing employees with a paid membership to a job search website or offering to pay for a head hunter. These steps will not only help create goodwill, but will significantly decrease the chance of a potential lawsuit against you.

fire employee angry

Tips for Firing an Employee

When it’s time to deliver the bad news, what you say, and how you say it, matters. It is important that you remain professional and do your best to be calm. You can show some compassion and sensitivity, but you still need to be professional.

Here are some tips for protecting yourself, and your company, as you deliver bad news about a job termination:

  1. Be straightforward. Be up front about the reasons for the termination. If someone is being fired because performance has suffered, this should be clear to the employee and backed up with a paper trail – including emailed or printed warnings or a poor performance review.
  2. Do it privately. Make sure that you give the bad news in a private place, limiting the number of people who witness the event. A meeting room is usually a good choice.
  3. Have a witness. Bring in a human resources representative, your supervisor, the employee’s direct supervisor, or someone from the legal department, as appropriate. It’s always best to have a witness who can take notes, and help make sure the situation remains under control. Additionally, the witness can serve another purpose, such as explaining the details of a severance package.
  4. Stick to the point. Be brief, clear, and to the point. State the essentials: “We’ve talked about your performance and productivity issues in the past, and things haven’t changed. We have to let you go.” Don’t talk about other issues, and don’t talk too much.
  5. Back up your claims. Make sure you have documentation of an episode of misconduct, or failure to meet performance standards. You should always record warnings that you have given, so that you have them as back up during termination proceedings.
  6. Let employees know their options. Be sure to let the employee know about severance policies, health care options, or career counseling if your company provides these options. Direct the employee to the people that can help transition to the new situation.
  7. Consider how you will have them collect their things. If the employee seems calm, and wants to gather his or her things quickly and leave, you can consider allowing this course of action. In many cases, though, it can be a good idea to schedule a time outside normal office hours for the employee to come back and gather belongings. This can prevent awkwardness and reduce the chances of a scene. Only if the employee becomes threatening, verbally or physically, should you have him or her escorted off the premises.

After the employee has been let go, do not speak ill of him or her. Do not divulge information about what happened. It is important that you remain professional even after the employee is gone. What you say about the employee after he or she has left could potentially be used against you during a wrongful termination lawsuit. Your ability to be calm, professional, and polite is essential.

Final Word

Firing someone is never easy, no matter what the reason. Even if you will be glad to see the back of an employee, the process can be difficult. You want to make sure that everything you do is in accordance with company policy, and in compliance with federal and state laws. You will protect yourself and your company if you follow proper protocol.

Have you had to go through this difficult situation? Tell us how your company coped with layoffs or how you handled a tough job termination.

(photo credit: Shutterstock)

Miranda Marquit
Miranda Marquit is a freelance writer and professional blogger specializing in personal finance. She writes for several web sites, and her work has appeared in numerous online and offline publications. You can find Miranda's personal finance blog at AllBusiness.com.

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  • Wiseguy

    To add to #2 about giving the bad news in a private place, I’ve heard it suggested to do it in a neutral place as well. Thus, a meeting room would be better than your office since that’s “your territory.” It a subconscious comfort/balance of power thing.

    • http://www.mirandamarquit.com Miranda Marquit

      Great point! You want to make sure that it doesn’t look like you are trying to take advantage of your situation.

  • http://www.resumeservicesonline.com Gerry @ Resume Services

    And sometimes you just have no further use for the person’s skills. There comes a time when your castle no longer needs moat-diggers (no matter what the Federated Unioon of Professional Moat-diggers has to say on the matter).

  • http://www.facebook.com/people/Kalen-Smith/648275192 Kalen Smith

    Thanks for the post Miranda. You always share great advice and I look forward to reading more. Firing someone is never an easy thing to do and I am glad I haven’t been in the situation to have to fire anyone yet. I think it depends greatly on the industry you are in to because sometimes there are different procedures you may have to follow when letting a specific type of employee go.

  • Doogster19

    My friend and I got fired on the spot by our boss(lunatic) who didn’t give us any chance to explain ourselves. Then after he snapped and fired us we walked out of the office (which had the door open the whole time) and he escorted us out of the building but on the way he told two teenagers as we were walking away “now there’s a momento for ya, those two kids just lost their jobs” exact words. isn’t that illegal to fire publicly and then say that to random pedestrians right after????

  • Lena

    I was just fired, completely with no warning or indication that I would be terminated. Some back story, when I first started working their they had just fired a girl with no previous warning (that I am aware of) but another girl who worked there had pierced her nose at the kiosk ( Its a coffee kiosk, but there is food and exposed syrups, powders, ect) and had gotten blood everywhere. She didn’t get fired, but i kept hearing from another girl the she was going to be replaced soon. I have some mental issues, nothing serious, and I don’t believe it effected my work.I covered peoples shifts, came in when they needed me while my other coworker was lazy and never stocked, and I seen her steal but didn’t think anyone would believe me, there was only 3 of us working there, the tension gets high. Anytime the co-worker with most seniority would come to me about something I always listened and did my best to prepare a certain person’s drink better. I was told often how great I was doing and how glad they were to hire me, and I got along with everyone in the mall as well. Then I came into open, and the girl who was suppose to be fired once again left a mess with nothing stocked. I cleaned up, it was busy and i agreed to work an hour extra for her. Right as I was doing shift change the girl with most seniority came in and was upset because “everything is dirty and she feels we need to stock more”, I always do, and she said she felt like that when she came back from her 2 days off which is when the other messy girl closes before she opens. A day later I get a call from the owner (who has never said any complaints about me) and told me I was fired for personal issues. The girl who pierced her nose and is a slob is still employed.

    So, was I fired illegally? Its a tiny business, no handbook or anything was signed and I was never told I could lose my job, on the contrary actually. Thanks for any input.

  • Tam M T

    I have a situation I hope you can help:

    I was working as a Caregiver and the vehicle I was borrowing had been taken away from me, the day I called to let them know I could not get to my client I did not say ‘I have to quit’. Days later I called about my check and was told they had fired me for not giving my 2 weeks notice. But no one called me to let me know I was fired, is there anything I can do? I have been trying to apply for unemployment benefits since I have been unemployed for months now. I have appealed twice and was denied both times. I want to re-appeal but doubting if I should.

    Tam

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