title goes here - suncoast hr · pdf filetitle goes here consequences of a ... you receive...
TRANSCRIPT
Title Goes Here
Consequences of a Poorly
Executed Employee Termination
Presented By:
William E. Grob and
Darren Veneri
You receive that serious call
from your boss: “Come Up To
My Office Immediately”
Your boss is definitely in a bad mood!
You are told just to bring a pad to take notes
Entering the boss’s office, you
can feel the tension in the air…
“Jane Smith, the regional sales manager, had a major
disagreement with one of our biggest customers, ABC
Enterprises.”
“The CEO of ABC Enterprises is very upset and called
me directly. He now refuses to work with Jane.”
“ABC Enterprises represents 27% of our total sales, and
it’s very important that we retain their business.”
“I want you to move forward and terminate Jane’s
employment as quickly as possible.”
Now what do I do?
My boss was very upset and wants to save
the business with ABC Enterprises
He has given me a direct order to terminate
Jane quickly
Florida is a “right to work” state…
So… I call Jane and terminate her
employment effective immediately.
What Can Happen Next?
Oh, and a little background
about Jane…
The Seven Rules of “Just Cause”:
Fair and Legal Corrective Action
Rule 1 - Knowledge
Did the employee know the workplace
rule, practice, or expectation and the
consequences for violation?
Common Sense Rule
Easiest test to satisfy
Documenting “knowledge”
Rule 2 – Reasonable Rules
Are the rules, practices, and
expectations reasonable, and do they
serve a business purpose?
Legal versus reasonable business rules
Proof of business reason
Rule 3 – Employee Explanation
Did the employee have the opportunity to
explain what happened, i.e., have his or
her “say”?
Employee’s “side of the story” essential
Due process/fairness
Rule 4 – Fair Investigation
Was the management investigation fair,
neutral, and complete?
Conflict of interest?
Pursue all leads
No pre-written discipline
Rule 5 – Actual Misconduct
Is there sufficient evidence that the
employee did, in fact, break the rule
and/or engage in the alleged
misconduct?
“No crime, no time”
Credibility determination
“Threats”
Rule 6 – Consistency of
Enforcement
Has the rule in question been enforced
consistently in the past? Has other
similar misconduct generated discipline?
Centralized decision making
How to kill a past practice or inconsistency
Rule 7– Penalty Appropriate
Is the particular corrective action
appropriate in light of the severity of
the offense, the employee’s length of
service, and all the surrounding facts –
“Does the punishment fit the crime?”
Often only issue
Importance of progressive discipline
Seniority of disciplined employee
Sympathy factor – the wild card
Should You Sever and
Release?
Is a Release Even Necessary?
Four Reasons to Consider Paying Severance and Obtaining a Release
1. Mass Firing/Layoff Situations (additional rules apply)
2. Employer Has Some Exposure to Liability
3. Employee’s Particular Circumstances
4. To Help You Sleep at Night
Considerations when
Offering a Release
Ensure consistent internal policy on offering
severance (not subjective)
Consider:
Years of service, Level of employee, Reasons for
termination (e.g., dishonesty)
Must knowingly and voluntarily agree to release
claims
A valid release may encompass unknown
claims and future damages
Attorney Review!
Severance Packages
Resignation option
Severance pay
Don’t pay too little or too much!
Common Benefits Offered
Severance Pay (best to use formula and not
case-by-case determination)
Outplacement/Career Transition Benefits
Life Insurance Continuation
Employer Paid Health Insurance Continuation
Severance Packages
Treating an employee fairly with a competitive
severance and outplacement package will:
Help the employee start the transition forward more quickly
and find a new professional opportunity
This will, in turn, lessen the time the former employee is
collecting unemployment insurance
Lessen the time the former employee remains on your benefit
plan
Lessen the risk of not signing the severance agreement and
pursuing a potential lawsuit against the company
Illustrate to the remaining employees that, under a difficult
circumstance, their former employee was taken care of and
given the appropriate support to move on in their career
COBRA Requirements
Consolidated Omnibus Budget Reconciliation Act of 1985
Mandates continued health coverage at employee’s own cost for a limited period of time after certain events
What triggers COBRA? Loss of health coverage due to a qualifying event:
Includes termination of employment
COBRA (cont’d)
Election Notice
Administrator has 14 days from receipt of qualifying event
notice from employer to send election notice to qualified
beneficiaries
If employer is administrator, 44 days running from:
Date of loss of coverage if plan provides, or
Date of qualifying event
How long do employees have to elect and pay for
COBRA?
At least 60 days to elect
Initial payment is due within 45 days of election
Must cover period from election retroactive to loss of
coverage
30-day grace period required for future payments
The Termination Meeting
The Termination Meeting
Gather Documentation
Termination documents
Non-compete/confidentiality agreements
Benefits information
COBRA notices
Employment references
Prepare and Rehearse
Rehearse the meeting with your witness
Prepare the final paycheck
Have benefits documentation ready
Have a termination letter ready (if required)
Have a release agreement ready
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 (don’t argue)
How will personal belongings be gathered?
Have the Meeting
Conduct the meeting in person, if possible
Conduct the meeting at an appropriate time of day
Have a witness present
Beware of tape recordings
Do not tape record the meeting
Do not apologize
Be brief and do not debate the decision
Do not overpromise
Engage employee immediately with Outplacement
Preserve Documentation
Keep termination documentation in a safe
place
Preserve all documents that led to the
termination
Keep copies of all non-compete,
confidentiality, and non-disclosure documents
Consider drafting a note to the file describing
the termination meeting
Follow up with Employee if necessary
Avoid Unnecessary Gossip
Avoid Unnecessary Gossip
Decide what you will tell coworkers about
why the employee is no longer working for
you
Decide what you want to tell clients about
why the employee is no longer working for
you
Don’t remain silent
Final Paycheck Considerations
Hot Tip #1
• Consider providing a letter explaining final paycheck, if applicable. 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.
• Florida does not require payment of accrued vacation unless otherwise provided in writing
• Must issue final paycheck no later than six calendar days after discharging employees.
Protect Your Customers
Hot Tip #2
• Remind employees of their confidentiality/non-disclosure obligations during the termination process. Consider providing a letter or statement like the following:
• Attached please find a copy of the Non-Disclosure Agreement you executed on March 10. Please note that its obligations survive the termination of your employment.
Checklist for Effective Terminations
1. Implement the decision … the sooner the better.
2. Proper documentation – before, during, and after.
3. Consider whether high risk termination.
4. Recruit at least one trusted witness to attend
termination interview.
5. Effectively communicate decision.
6. Tie up loose ends.
7. Consult an attorney if necessary.
Questions??William E. Grob
(813) 221.7228
Darren Veneri
(813) 364.0304