presented by: austin e. smith managing shareholder, denver office termination documentation pitfalls...

Presented by:Austin E. SmithManaging Shareholder, Denver Office

Termination Documentation Pitfalls

Colorado SHRM State Conference – Thursday, October 1, 2015


Our Focus for Today

• We pick up the discussion at the point when the termination decision has been made.

• We will not discuss disciplinary processes, mass terminations, or actions that may occur after the termination has been implemented.

BUT, I’m happy to discuss any of these items after the presentation. . . . .


At-Will Employment in Colorado


At-Will Employment in Colorado

In the absence of a contract to the contrary, neither party is required to give advance notice of or a reason for termination or resignation.

At-will has many exceptions, both statutory and common law.


Right to Work

Right to Work

Employment-at-Will

Only Relevant if We’re Talking about Unions

Refers to Parties’ Right to End Their Relationship


Review the Documents



Why?• Make sure the reason for termination is

legitimate and well supported

• Make sure you are comfortable with the investigation

• JURIES EXPECT DOCUMENTS

• They expect them to be complete, accurate, and consistent

• Make sure they reflect adequate and objective reasons for termination

• Was the employee ever provided an opportunity to respond in writing?



Hot Tip

Don’t terminate an employee without an articulated reason.

• Be able to express your reason in clear, understandable, and objective terms.

• No laundry lists. There is usually a triggering event that prompted the termination. That is the reason that should be used as the basis for the termination.


What Are You Looking For?

Stray remarks– “Smoking Guns”– Emails

Consistency– With the way similarly situated employees

have been treated in the past– With company policies and past practices

Presentation

Who are the witnesses?– Evaluate their credibility– Evaluate their performance and work

history


Blueprint for Your Defense

Documents are not required by law

Juries understand “at-will” but want to know “why?”

Juries look for fairness

But, documents are exhibits

Contemporaneous documentation:– bolsters credibility, witness

confidence, and likeability


Documentation Bloopers

Documenting opinions/editorializing– “I think” and “I believe”

Documenting Documentation

– “Is the documentation good enough to terminate? What are the next steps?”

– “Documentation is not good enough at this time. Need more documentation before we can terminate.”

Speculating– Reaching conclusions not based on facts

Exaggerating– Using absolutes, adverbs, and adjectives

Allocating blame

Disclosing advice from counsel or attorneys’ work product


Severance and Release?


Is a Release Necessary?

Four Reasons to Consider Paying Severance and Obtaining a Release

1. Mass Firing/Layoff Situations (additional rules apply)

2. Employer Has Exposure to Liability

3. Employee’s Particular Circumstances

4. To Help You Sleep at Night


The Termination Meeting


The Termination Meeting

Gather Documentation

Prepare & Rehearse

Have the Meeting

Preserve Documentation

Follow-Up (if necessary)


Gather Documentation

Termination documents

Non-compete/confidentiality agreements

Benefits information

Final paycheck

COBRA notices

Employment references

Release Agreement


Prepare & Rehearse

Consider using a script Rehearse the meeting with your

witness Have a termination letter ready

(if required) Do you need to notify security? Do you need to notify IT? Will you offer the employee an

opportunity to resign? Anticipate problems that may

arise How will personal belongings be

gathered?


The Meeting

In person if possible

Meet at an appropriate time of day

Find a private, quiet location

Have a witness present

Beware of recordings

Do not record the meeting

Avoid emotions

Do not apologize

Be brief and do not debate the decision

Do not overpromise

Recover company property

Avoid “perp” walks


Preserve Documentation

Keep termination documents in a safe place

Preserve all documents Keep copies of all non-

compete, confidentiality, and non-disclosure documents

Consider drafting a note to the file describing the meeting

Consider taking a snapshot of the employee’s hard drive and email account


Final Paychecks

Timing & Deductions


Avoid Unnecessary Gossip


Final Paycheck Letter

Hot Tip

• Consider providing a letter explaining final paycheck. For example:

• Our records indicate you have 42 hours of accrued and unused vacation. Enclosed please find a check for vacation accrued through the Separation Date, less applicable withholding amounts.


Protect Your Assets


Protect Your Assets

What are your assets?

Your products

Your trade secrets

Your confidential business information

Your customers

Your employees


How Can You Protect Them?

Did the employee have access to “trade secrets” or confidential information

Relevant handbook provisions Confidentiality agreements Codes of Conduct Non-disclosure obligations Inventions agreements Non-compete Non-solicitation of employees


Protect Your Employees

Is there a chance the employee will become violent?Should you put police on

notice?Does the employee carry a

weapon? Increase security? Preserve surveillance footage? Colorado’s civil protection order

statute


Presented by:Austin E. SmithManaging Shareholder, Denver Office

Termination Documentation Pitfalls


presented by: austin e. smith managing shareholder, denver office termination documentation pitfalls...

Documents

termination decision

articulated reason

consistentmake sure

supportedmake sure

law juries

contemporaneous documentation

objective reasons

objective terms