How to Terminate an Employee Without Legal Consequences

Injustices that the law will rectify are dwarfed by the injustices it will not. We generally consider non-actionable injustices to be frivolous claims. The parties’ “interests” almost always include non-actionable injustices which mediation can address.

Actionable injustices

World of

Injustice

Employment Injustices the Law Will Remedy

• Employment contract– Specific duration– Requiring cause for dismissal

• Termination, transfer, etc. that infringes on specific public policy interest (exception to at will doctrine)– Refusing to act improperly – refuse to

engage in unlawful conspiracy– Exercising a right (filing workers’

comp claim)– Whistle blowing (complaining about

misdeeds)– Performing public duties (jury duty)

Improperly Motivated Terminations, Demotions,

Reassignments, Etc.

• Support for a union (NLRA)

• Race, color, religion, sex or national origin (Federal Civil Rights Act)

• Age; veteran status, disability, pregnancy, indebtedness (federal & state laws)

• Sexual or gender preference (California)

• Quid pro quo or hostile environment sexual harassment

• median awards– $151,800 men – $75,000 for women (’88-’95)

• ’88 - cost of litigating 1 case averaged $80K

• ’92 studies -- general reluctance to terminate poorly performing employee for fear of suit

• Research in accident cases shows the further litigation proceeds, the more distasteful the experience for plaintiffs )

• plaintiffs frequently prevail – 64 percent of the time when the

plaintiffs are executives; and,– 42 percent of the time when they are

general laborers

• distributive justice, or the perceived fairness of outcomes

• procedural justice, or the perceived fairness of the procedures by which outcomes are determined

• interactional justice, the perceived fairness of the nuances of interpersonal treatment.

• negative experiences with supervisors;

• Belief that processes used by the supervisor are unfair.

• violations of procedural justice • perceived violations of equity and

distributive justice • perceived violations of interactional

justice • survivors' attitudes toward their

organization are strongly associated with their beliefs about the fairness of the manner in which their companies laid off other workers

• unfair treatment carries a message of social exclusion, threatening social identity

• extremely unfair treatment, carries message of rejection• Resulting loss of self-esteem provokes vendetta effect

the greater hardship associated with job loss,

the greater impact fairness judgments have on

seeking redress

• Shorter notice of impending termination increases claiming thoughts and actions. – learn of dismissal when

company AmEx card is rejected at a restaurant

– Learn of dismissal when return to office after lunch and find someone taking name plate off the door

• Failure to provide assistance in finding new employment increases claiming thoughts and actions.

Naming, Blaming and

Claiming

• “claiming” is a multistage process. – Begins with perception

that the event is injurious.

– potential claimant must then blame someone other than themselves for the injury

– potential claimants must possess the will, the means, and the know-how to pursue their claims.

Though claimants' actions may be driven primarily by loss, suit will not be brought under the contingency-fee paradigm unless the attorney believes there will be a sufficient financial pay-off to justify the attorney’s time and expense.

• unfair, insensitive treatment at the time of termination had twice effect of next most potent factor in bringing suit.

• Blame not strongly related to the claiming process

• Some, but slight, support for proposition that certain groups are especially likely to sue– Women’s, minorities’, and

union workers’ reasons lay as much in perceptions of poor treatment as in perceived likelihood of success

• Best predictor of willingness to file claims was highly educated respondents

• people react to nuances of treatment and style at the time of termination

• quality of the dismissal will affect people’s decision to bring suit as much as termination itself.

• fair, honest, dignified termination should reduce the temptation to retaliate through litigation.

Employees terminated in most disrespectful fashion

• May seek to use litigation to force former employers into a negative relationship to retrieve some of the social identity lost by a demeaning dismissal

• the litigation, once undertaken, will likely continue until the employee feels some return of the social identity they lost in the termination experience

Non-Monetary Offers of

Assistance

• good treatment of laid-off or fired employees– Give several weeks advance

warning – provide help in finding new

employment – Give honest accounts– provide transitional alumni

status when possible– provide symbols of positive

regard such as letters of reference, departure gifts or parties

– offer counseling to ease the psychological shock of employment termination

We can’t afford a golden parachute but Stanley here is working on a nice paisley umbrella

Assistance with the Financial and Personal Crisis of Job

Loss

• extend insurance benefits

• offer generous severance packages

• provide financial planning services

• Offer ombuds programs• Referral services• Job re-training

resources• Revamp personnel

policies• Name something after

the person; retire his employee number; give certificate of merit, etc.

You Didn’t Think We’d Ignore the Employer

Did You?

• Interests– Fear of other claims

following this one no matter how good the confidentiality provisions

– Sense of being extorted– Sense of vulnerability – Fear of being “wrong,” i.e.,

that personnel policy or practices & procedures not up to par

– Management’s fears of being blamed

– Sense of injustice– Often paternal or maternal

attitude toward employees & feelings of ingratitude

The Employer Seeks Fairness as Much as

the Employee

• The way in which we respond to adversity "often reflects the fact that [our] prestige or status has been threatened more than the fact that [our] purchasing power has been diminished." Miller, Disrespect and the Experience of Injustice, Annual Review of Psychology (2002).

• In other words, the corporate C.E.O., like any other kid on the block, will retaliate when he feels he has been disrespected.

• Conversely, research shows that business people are reluctant to recommend legal

• action if they believe that they and their company have been treated respectfully.

• Every commercial interaction, we are told, "represents a social exchange and every form of social behavior represents a resource." Id.

• People's satisfaction with the outcome of a commercial transaction therefore "depends highly, and often primarily, on their perception of the fairness of those outcomes." Id.

Copyright 2006 Charles Fincher

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