If you operate a business it is virtually certain that from time to time it will be necessary to terminate someone’s employment. The majority of employment-related claims against employers result from employment separation. These employment claims arise from not only involuntary terminations but from what is referred to as “constructive discharge,” i.e., employees who quit but claim that their resignation was because of intolerable and unlawful working conditions, such as sexual harassment. Almost all of these claimants allege that they were discriminated against by their employers because of their race, color, age, sex, religion, national origin, disability or because they reported sexual harassment. As is the case with sexual harassment, often a mediocre claim by an employee becomes a very good claim because the employer retaliated against the employee for reporting the alleged discrimination or harassment to management or for filing a claim with a government agency.

Discrimination Claims

Discrimination claims are prosecuted either by filing a claim with the United States Equal Employment Opportunity Commission (EEOC) or the Michigan Department of Civil Rights (MDCR) or by filing a lawsuit. A claim filed with either government agency generates an automatic filing in the other agency. A significant percentage of discrimination claims either begin or are completely resolved during EEOC or MDCR proceedings.

Employees routinely favor EEOC and/or MDCR procedures because they are free. Claimants do not need to hire an attorney since either the federal or state government, on behalf of the claimant, investigates and attempts to resolve the dispute. However, an employee who files a claim with either of these government agencies, regardless of the outcome of the government investigation, still may sue the employer in state or federal court.

To initiate a federal lawsuit, the claimant normally must engage in EEOC proceedings and file a lawsuit within 90 days after the EEOC issues a letter referred to as a “Right-To-Sue” letter. This letter is provided to the claimant regardless of whether the EEOC agrees with the claim or not. Similarly, irrespective of the outcome of the administrative investigation, a claimant may file a lawsuit in state court but under state law has 3 years from the date of the incident to do so and is not required to first file an administrative claim.

Regardless of the form of any employment-related litigation, it is to be avoided. Based upon my 29 years as a management employment lawyer, I have prepared a checklist that, if followed, should substantially reduce the likelihood of your business being sued by a former employee. Acting hastily is the best way to be sued. Thinking through the situation and discussing it with your professional advisor dramatically improves your chances of an effective termination that will not become lengthy, time consuming and expensive litigation.

Termination Check List:

• Determine whether discharge is appropriate. Don’t shoot from the hip. Is the employee salvageable or hard to replace? Has the employee been sufficiently warned?
• Determine the real reason for the discharge and say so. Poor performance is not the only acceptable reason.
• Review the documents in the employee’s personnel file. Look for prior discipline. Look for employee evaluations inconsistent with termination. Reminder:  There is no substitute for paper.
• Review protected classes. Look at race, color, age, sex, religion, national origin and disability.
• Check how other similarly situated employees have been treated. Consistently? If not, has there been a disparate impact on any protected class?
• Review recent events. Has the employee complained of anything lately?
• Be alert for evidence of retaliation, cover-up or building a file after the fact.
• Determine whether a severance agreement and release is appropriate.
• Plan the discharge and stick with it. Who will be there? What will be said? Do not let the departing employee bait you into an argument or put you on the defensive.
• Document your investigation and what was done and said at the time of termination.
• Determine how you want to handle a claim for unemployment compensation.
• Determine whether it is really necessary to replace the terminated employee.

For further information regarding these matters, please contact Mr. Boyer at 248.740.5666 or click here to send an email.