The "Hows and Whys" to Terminating Employees

Firing an employee is usually stressful for all involved. In all but the clearest of cases, the employee feels it is unwarranted and the employer always retains some nagging doubt. Still, there will always be the need to judiciously and legally terminate the employment of an underperforming or problem-plagued member of one’s staff.

While most managers have had some training and are given a company manual that explicitly details the termination process, many fail to follow the proper procedures and therefore expose the company and sometimes themselves to legal action.

Legitimate Reasons for Terminating an Employee

The leading cause used for employee termination is poor performance or outright incompetence. Termination for this reason is also one of the most vigorously contested by ex-employees. Since the reasons given can be usually subjective, it is imperative that a clear and definitive paper trail be established during the counseling and termination process.

Safety Issues

Employers are required by law to provide a safe workplace for their employees, The pertinent statutes cover a wide range of issues including workplace harassment and work space safety. Any employee who harasses another or willingly creates a dangerous environment can be terminated.

Illegal Activities
Similarly, employees who steal or misuse company property are also subject to termination. In addition, employees found to be using illegal drugs or alcohol on the job are subject to termination. In these cases, since there are legal ramifications, it is important to have documented proof of the infractions.

The Downside to Improper Termination

The risks involved with the improper termination of an employee are twofold. In the first case, an employee, whose termination has not followed prescribed company policy, can make the case at an unemployment hearing that the reason was merely contrived for the convenience of the company. Without the proper documentation, it is an unfortunate fact that unemployment boards are predominantly siding with employees in these situations. The downside to the company is that their unemployment insurance rates will rise.

The second case is has the potential for far more significant consequences. Many human beings will twist any situation to fit their world view. A legitimate firing may be interpreted by the ex-employee as being due to their inclusion in a protected class or as retribution for earlier claims of harassment or company malfeasance. In cases like these, a company has a potential liability in the millions of dollars and the alleged perpetrators can also face criminal and civil charges.

Avoiding Improper Termination

Procedural Issues
To avoid accusations of unfair or improper employee termination, it is essential that a company develop and implement a prescribed procedure for dealing with the issue. In addition, this procedure should be documented in writing and disseminated to all new-hires. It is then a relatively simple matter for management to follow the guidelines and only properly terminate employees.

Proper Documentation
In an ideal world, the above process would work smoothly and efficiently. The real world always intrudes however, and many managers, due to time constraints, forget or neglect to follow some of the procedures. Upper management needed a way to document the proper implementation of their procedures and, thus, the paper trail of employee termination was born. It is essential that upper management or HR personnel review all termination documents at some point. In addition, the paperwork must be properly stored and readily available.

The Role of an HRIS in the Termination Process

Objectivity and consistency are the human components necessary for avoiding the improper termination of an employee. A paper or electronic trail of verifiable actions and readily available documentation provide the proof that a manager has acted in this manner. In an overall sense, the problem remains that while most managers will follow the proper protocols, some will not.

A well-designed and properly implemented HRIS can address every one of the issues above. At the beginning of the process, the system can act as a repository for the proper forms and make available the latest company handbook and termination procedures. As the process proceeds, the system can act as a gatekeeper ensuring that the proper procedures are followed and documented.

Finally, the system can archive the relevant forms and other documentation in an easily accessed and readily available format. Upper management and HR can review documents remotely and often ahead of time to ensure maximum compliance and the least amount of problems.

A Final Thought

In a nutshell, an HRIS will provide a framework and real-time guide to company policy on the termination process. Most managers have the best of intentions but circumstances can lead them to make mistakes. An HRIS provides a convenient way for them to double-check the process and to communicate with their superiors in unusual situations. Obviously, an HRIS cannot replace the manager in an employee termination situation. It can, however, act as an excellent HR tool for good managers and as a safeguard against bad ones.

About the Author
Carolyn Sokol writes about issues that may affect small businesses such as human resources, hr management software, and HRIS systems. She is a founder of and contributor to, both of which help match businesses to the right HR or payroll service provider for their particular needs. Her background is in marketing and communications, employee education and training, development of policies and procedures and the ongoing delivery of outstanding customer service.