Tips for Avoiding a Wrongful Termination Charge

As today’s historically high unemployment rates suggest, most people know someone who has endured the experience of losing a job. George Clooney’s portrayal of downsizing expert Ryan Bingham in the film Up in the Air has become something of a cultural touchstone: the employer’s paid representative coolly providing the bad news of imminent unemployment. However, the reality for most businesses, including medical practices, is that the business owner or another employee is tasked with the uncomfortable role of terminator. If the termination is handled improperly, the former employee may lodge a complaint against you. In fact, wrongful termination charges filed with the United States Equal Employment Opportunity Commission (EEOC) rose last year for the seventh consecutive year.

Here are tips for avoiding a wrongful termination charge:

Be Deliberative

The difference between a termination that gives rise to a dispute and a termination that brings quick closure is often in the planning. A summary termination in response to something that just happened should be a very rare event. Even in a case in which an employee’s conduct clearly justifies immediate termination, you should take time to plan the termination.

The ability to terminate quickly and with clear legal basis starts at the beginning of the relationship. Well thought out employment-related documents (e.g., employment agreements, employee manual/handbook, detailed job descriptions, disciplinary memos and evaluations) should tell the story of why the relationship ended. They provide a contemporaneous record of the terms and conditions of employment, basic expectations of employee performance, the employee’s actual job performance, the reason for the termination decision and the post-employment obligations of the employee, such as restrictive covenant and confidentiality, and of the employer, such as the final paycheck and accrued vacation time.

Often, however, even when the need for termination is obvious, employment-related documents will not be crystal clear. Taking the time to review your practice’s policies and procedures and the employee’s personnel file—rather than relying on what you believe are in the policies, procedures and personnel file—will provide valuable context in deciding the best way to end the employment relationship.

You should consider the best way to transition the outgoing employee’s tasks with minimal disruption to the business.

Be Pragmatic

You should consider the best way to transition the outgoing employee’s tasks with minimal disruption to the business. A termination that leaves you shorthanded may be necessary in some situations, but you can ease into many terminations in order to mitigate disruption to practice operations. Also, you should consider the impact of an employee’s departure on patients and the public image of the practice. Sometimes employment agreements will provide protection against unfair competition, the unauthorized disclosure of confidential information and disparagement in the community. Other times, no such protections are in place.

It is often helpful to involve a lawyer in the termination process, in order to help with the defensibility of the termination from a legal standpoint. Does the employment agreement allow for termination without notice? Is a severance obligation triggered? Do certain facts give rise to concerns of a discrimination, wage, leave, tax, whistleblower or retaliation claim? Are there continuing obligations that need to be met by the employer or enforced upon the employee?

Be Understanding

Thinking about the outgoing employee’s immediate concerns is a constructive exercise that often facilitates termination planning. It is more challenging than ever to be unemployed, and reflecting on the human aspects of termination will always be helpful when preparing to deliver tough news. Take some time to consider the practical realities of the outgoing employee. Do you intend to challenge unemployment? You’ll likely be asked, so it’s best to make that determination before heading into the meeting. What about severance? Does potential legal exposure make obtaining a release of claims in exchange for severance a priority? In some cases, a little generosity and compassion on the way out can prevent significant trouble later on.

Be Direct

Employers often find themselves in trouble as a result of trying to avoid conflict. If you are reluctant about being candid in job evaluations or in identifying poor performance or unacceptable conduct as it occurs, an outgoing employee may protest that there was never any warning that his or her job was on the line. In wrongful termination disputes, an employer’s silence with regard to poor performance or bad conduct is frequently cast as proof that such performance or conduct was not the real reason for the termination decision. Being polite is counterproductive if it means that a judge and jury are left to wonder whether the termination decision was made for legitimate or unlawful reasons.

At the time of termination, both of you will benefit from speaking directly to the reasons for severing the relationship. An in-person meeting between a representative of the practice and the outgoing employee, followed by a written statement of what was said at the meeting, should be considered best practice. This discussion should not be a dialogue, however. A brief statement detailing the reason or reasons for the termination, the terms of separation and a statement of best wishes will suffice in most situations.

Being direct does not mean dwelling on every aspect of an employee’s poor performance. The termination meeting should be a low-temperature affair. The news should be delivered in a concise and measured tone. If possible, it should be conducted behind closed doors with two representatives of the employer to provide corroboration of the termination process in case it is required in the future.

Deliberations on the termination should be kept within a small circle, and details beyond the fact of the termination should only be provided on a need-to-know basis. A statement that the company made the decision to terminate based upon specific grounds (poor performance, absenteeism) will suffice. If challenged, stick to stating a summary of the company rule or expectation that the employee failed to meet. Avoid inflammatory adjectives and phrasing. Insubordination is a valid reason to terminate. “Rank” insubordination is an unnecessary escalation of a difficult conversation. “Absenteeism” is grounds for dismissal. “Job abandonment” is a legal term of art, however, and should be used only when actual job abandonment has taken place.

Careful planning and calm consideration can make the difference between proper termination and wrongful termination, avoiding a costly lawsuit and a poor public image.

Steven M. Harris, Esq., is a health care attorney and a member of the law firm McDonald Hopkins, LLC. Reach him at sharris@mcdonaldhopkins.com.

Reprinted with permission from the American College of Rheumatology.