Letting an employee go is never easy. No one wants to be the bearer of bad news, especially in California where employee terminations seem to frequently end in (or begin) claims or lawsuits alleging discrimination, harassment, or retaliation. Avoiding, or reducing, the risks of claims and suits requires preparation before, during (including the termination meeting), and after the employment.
Preparation should start before the employment
Be sure your company has written policies and procedures about handling employee complaints or concerns relating to discrimination, harassment, and retaliation. Have written discipline policies and evaluation processes to show that the company takes employee conduct and performance seriously.
Preparation during the employment
Conduct regular, thorough, and documented performance evaluations. Respond to employee misconduct issues with appropriate investigation, and timely written discipline notices and write ups. And, make sure the employee’s personnel file is current and complete. In California, a current and former employee has the right to inspect his or her personnel file within 30 days after written request.
Preparation for the termination meeting
Remember that a terminated California employee must be paid his or her final wages, including for accrued unused vacation time, at the time of termination (late payment will result in monetary penalties). Also, the employee must be provided with notice relating to COBRA and notice relating to the California Employment Development Department (i.e., unemployment insurance benefits). You should have the employee read and sign a notice of change of employment status, and, request the immediate return of all company property. Conduct the termination meeting without arguing with the employee. Keep it short and simple.
Preparation after employment
California’s Labor Code requires the employer to maintain the terminated employee’s personnel file for at least three years, so keep it safe because it might be requested by the former employee, his or her attorney, and the government (if an administrative complaint is filed by the former employee). If a prospective employer calls for a job reference, the safest response is a neutral one – dates of employment, job title, and wages/salary. A best practice is to have someone designated and trained in advance to be the job-reference handler, and inform all employees to direct all job reference inquires to the designated person. You don’t want the first person who answers the phone to provide a shoot-from-the-hip job reference–there are criminal and civil liabilities for false statements.
Terminating a California employee is fraught with peril. While avoiding the legal wrath of an angry former employee might be impossible, preparation and consistency will greatly help to reduce the risks.
Brian Inamine is a shareholder resident in the firm’s Los Angeles office. Mr. Inamine counsels clients on workplace investigations, employee discipline and termination, discrimination and harassment issues, and best practices to avoid claims. In addition to his employment practice, Mr. Inamine represents companies in litigation involving business disputes and catastrophic personal injuries.