Termination Legal Ethical Issues Termination

Termination

Legal Ethical Issues Termination

Employee termination: Ethical, social, and legal issues to keep in mind

The downturn in the economy has made life worse for many Americans, particularly those employees who make up the ranks of the unemployed. Yet the recession has also caused no small amount of grief for employers, who often must make difficult decisions about who to terminate, based upon the organization's reduced financial resources and a drop consumer demand. Making decisions about layoffs require weighing such factors as worker seniority and past and current assessments of worker competence, and skills. The budgetary process, performance reviews, and a general forecast of the company's overall future will all come into review during a wide or even a small-scale termination of many workers. "RIF [Reduction in Forces]s require terminating multiple employees, bringing not only the risks of allegations of discrimination, retaliation and breach of contract as any other termination but also unique legal challenges, such as obligations to provide particular notice to employees. Companies are well-advised to consult an attorney in preparing for and implementing a RIF to help navigate the many potential dangers" (Blinn 2009).

When deciding whom to terminate, the issue is seldom as clear-cut as simply keeping the best employees and firing the least productive workers. For example, take the issue of seniority: a company wishes to show that it honors long-standing service to an organization, and loyalty, as worker retention is a long,-standing objective for most human resource departments. Workers will not be apt to stay at an organization that is not as committed to their growth and development. Letting go younger employees with potential vs. older workers with a demonstrated track record must be weighed, in terms of the pros and cons of both approaches for the company's recruitment policy in the future.

The lower salaries of younger employees who can do the same type of work as older employees might be an argument for retaining less experienced workers, if the layoffs are primarily for budgetary reasons. This strategy, however, could give rise to complaints of age discrimination and even costly lawsuits, if the target of a wave of firing tends to be older company employees. Additionally, "if your RIF includes employees who are age 40 and over, the Older Workers Benefits Protection Act requires particular notice be given to those employees, including specific details regarding the ages of other employees included in the RIF and the positions they formerly occupied" (Blinn 2009).

Even if certain workers being terminated come disproportionately from specific areas of the company, which results in a gender, ethnic, or other type of imbalance in the numbers of individuals who are being 'let go,' it is essential that the articulated reason for the layoffs is because of necessity and a coherent corporate restructuring policy that is not rooted in discrimination. The company should be aware that an impression of discrimination may be erroneously created if, for example, if a new computer system allows a large amount of administrative assistants to be replaced by the improved technology. If a large proportion of these employees tend to be older women, it must be clear that this is the reason for their termination, and not other reasons. In light of potential legal difficulties, some companies may continue to keep such workers until retirement, or offer them incentives to take early retirements, and simply not fill the positions, rather than actively terminating these workers. "One way to help to insulate your company from lawsuits is to offer severance payments in exchange for a release of any claims that the employee could bring against the company or its employees" (Blinn 2009). However, a more effective approach than keeping inefficient employees may simply be to have a strong company policy about discrimination. A zero-tolerance policy for harassment, a proactive approach to diversity, and actively recruiting individuals from a wide variety of backgrounds ensures that when layoffs occur, they are less likely to unfairly penalize one group more than another group.

To avoid legal complications requires scrupulous record-keeping and clear policies about terminating workers. These policies should be articulated as part of the hiring process. These should be in place before the need for any terminations occur for the employees in question. "Develop reasonable standards of conduct and provide them to your employees in writing…You should also have your employees sign an acknowledgment that they are aware of and have read your company policies and standards of conduct, that they agree to follow the rules you have established, and that failure to follow such rules can lead to discipline up to and including termination" (Employee termination: Things to consider, 2009, Small business notes). If problems do arise, long-term, written records should be kept of the progressive disciplinary procedures: "verbal warning, written warning that job is in jeopardy, and then, if necessary, termination," and all communications should be kept in writing (Employee termination: Things to consider, 2009, Small business notes). It is a good idea to have an exit interview to brief the employee on the reasons for the termination, to minimize potentially bad feelings and also to guard against legal liabilities.