HR MATTERS E-TIPS
This Week's Tip: "At Will" Termination (Part 2 of 2)
Published by Personnel Policy Service, Inc.
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^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ This Week's Tip: "At Will" Termination (Part 2 of 2) An at-will policy statement is an important element in maintaining management flexibility and in keeping your handbooks and policy manuals from being interpreted narrowly as binding legal contracts. This available flexibility, however, should not be used as an excuse to short-circuit normal disciplinary and termination procedures. |
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In last
week's E-Tips, you found out what "employment-at-will" really means and what it protects. While most experts don't advise terminating an employee by invoking the at-will relationship, they do agree that a clearly written at-will statement is still a valuable tool. It can protect your policies and procedures so that they are not interpreted as contracts that must be followed exactly. (If you missed that E-Tips, click here for a copy: http://www.ppspublishers.com/ez/html/101204txt.html This week, you will learn five steps you should take before terminating employees and seven points courts are looking for in your at-will policy. * Don't Terminate for "No Reason" * So if you should not terminate solely by saying that an employee is at will, how do you terminate a problem employee when a manager has not properly documented performance deficiencies? Your best bet is to follow your normal disciplinary process, even if that means taking extra time before you terminate the employee. For most employers this includes: 1. Giving notice to the employee of the specific performance problems and the consequences of not improving. 2. Establishing goals for improvement. 3. Setting a reasonable time frame for meeting the goals (normally two weeks to thirty days). 4. Following up to see if there is improvement. 5. Terminating the employee if the goals have not been met. To support your actions further, you should document the performance issues and the steps taken before terminating the employee. This record helps establish the fairness of your process and can help you defend against any subsequent discrimination or wrongful discharge claims. Of course, you may encounter circumstances where you feel you cannot take the time to follow your normal disciplinary procedure. In these cases, it is still better to discuss the specific problems with the employee and explain that they are the reason for the termination. If you simply invoke the at-will relationship and give no reason for the termination, the employee may assume that the true motive is related to discrimination or some other illegal act, and thus seek legal recourse. The introductory period is one situation where some HR experts feel the "no reason" at-will clause may be properly invoked to terminate an employee. This period is usually structured as a trial where the new employee can be terminated without following normal policies. In other words, the employee is already on notice and job security expectations are low. However, as with your longer-term employees, if you do not identify a reason for the termination, you may unnecessarily cause the employee to suspect discriminatory motives. Therefore, if you can point to a particular reason why the new employee is not performing well (for example, poor job or interpersonal skills), you may be able to reduce the odds that discrimination or other employment claims will be filed. * What the At-Will Statement Should Include * Even if you should not rely on the at-will relationship for terminations, a well-written at-will statement helps maintain your flexibility in applying your policies. Several courts have ruled that employers that have not included an employment-at-will statement in their policies may be legally required to follow their policies uniformly, without regard to the circumstances. For example, in Brown v. Scott Paper Worldwide Co., 20 P.3d 921 (Wash. 2001), the Washington Supreme Court decided that a paper salesman's at-will sales agreement was modified by the company's handbook, which he received later. The handbook did not contain an at- will clause and, in fact, promised specific treatment in certain circumstances. In reviewing the legal status of your at-will relationship, most courts will want to see as many of the following seven points as possible: 1. The at-will statement is written in clear, understandable language, not legalese. 2. It thoroughly explains what the at-will relationship means. 3. It clearly states that no company representative may change the at- will relationship through oral or written promises. 4. It explains that the organization's policies and practices are not intended to create a contract. 5. It is prominently displayed, such as in bold type, in a separate introductory policy, or set apart in other policies. 6. It is repeated where appropriate in other policies, particularly those outlining work rules and disciplinary procedures. 7. It is included in other employment documents, such as application forms and offer letters. * Defend Your Policies, Not Your Method of Termination * An at-will clause is a valid, but harsh, legal tool that grants you some flexibility in applying your personnel policies. It should not be used, however, as a substitute for sound disciplinary and termination procedures. Faulty discipline and termination procedures can provoke unwarranted suspicions of discrimination and thus create unnecessary legal exposure. The at-will clause may not prevent you from being sued, but it can be helpful as a legal defense when policies were not, or could not, be followed. Therefore, you are best advised to conduct your HR affairs so that legal theories are your last line of defense, not a substitute for sound operating procedures. |
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