How to Fire an Employee: Employment Termination Rules and Best Practices
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Once you have made the difficult decision to terminate an employee, you should consider some best practices for delivering the news. Doing this right can help you avoid legal risk. It can also make the experience less painful and more productive for the employee.
In contrast, missing a key element like a final paycheck, failing to clearly explain the reasons for the termination, or failing to anticipate and protect against a wrongful termination claim, could lead to costly legal battles with your former employee. At Will Employment and TerminationMassachusetts is an "at will employment" state. Generally, this means you can fire an employee for a good reason, a bad reason, or no reason at all. There are important limits to this rule, however- you cannot fire an employee for an unlawful reason.
The most common unlawful reasons for termination are discrimination against someone in a protected class and retaliation against an employee for engaging in protected activity, such as reporting sexual harassment or wage and hour violations. This list of people who could fall into one of these categories is larger than you might expect. This does not mean these individuals can never be fired- if you have reasons for terminating an employee that are valid, you can still legally do so. If you have any concerns at all about the employee you are considering firing or disciplining, it would be a good idea to consult with an employment attorney. |
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Terminating Employment: Legal Requirements at Termination
No matter what the reason for termination, employers have certain obligations under Massachusetts law that are strictly enforced. These are:
It is important to remember that the final paycheck is a requirement of the the Massachusetts Wage Act. That means if you don't pay on time, the employee can make a Wage Act claim and recover triple damages and attorneys' fees. You are going to want to get this one right, even if you have to postpone the meeting for a day or two to get the right calculations and cut the check.
- Immediate payment of all wages earned up to the time of termination. This includes accrued unused vacation time and must be paid the day of termination. Note you do not have to pay for unused sick or personal days.
- Information about applying for unemployment benefits must be provided to the employee even if you believe they are not eligible to collect benefits.
- If the employee is part of an employer-sponsored group health plan, you will have to provide notice of the right to continue participating in that plan for a period of time (“COBRA”). This notice can be given after the termination meeting. You are not required to continue contributing toward the premiums.
It is important to remember that the final paycheck is a requirement of the the Massachusetts Wage Act. That means if you don't pay on time, the employee can make a Wage Act claim and recover triple damages and attorneys' fees. You are going to want to get this one right, even if you have to postpone the meeting for a day or two to get the right calculations and cut the check.
Terminating an Employee: Preparing for the Meeting
Before you sit down with the employee, you should review a few things. First, is the reason for termination documented? If the issue is the employee's performance, you should check to see if the problems are documented. If they are not, you may need to be prepared to explain to the employee, who may be surprised.
Second, you should assess whether the employee is in a protected class under federal and state employment laws. If they are, you may want to consult with your human resources department or a lawyer to make sure there is no basis for the employee to claim wrongful termination.
Third, you should review your employee handbook and policies to try to be consistent with those policies.
Finally, you should make sure you have all of the things you are required to give the employee at termination (see above).
Second, you should assess whether the employee is in a protected class under federal and state employment laws. If they are, you may want to consult with your human resources department or a lawyer to make sure there is no basis for the employee to claim wrongful termination.
Third, you should review your employee handbook and policies to try to be consistent with those policies.
Finally, you should make sure you have all of the things you are required to give the employee at termination (see above).
How to Fire Someone: The Actual Meeting
What to say when terminating an employee? Remember that this is not easy for anyone. As much as the decision may be necessary and important to protect the health of the business, someone is also losing their job. Even if you have to deliver difficult news, you can try to be constructive and keep a focus on the future.
If you have a human resources department, it is a good idea to have an HR representative present for the meeting. If you do not have an HR representative, you may consider having someone else sit in on the meeting, to serve as a witness and possibly to reinforce whatever message you have for the departing employee. You should make sure that having another person present does not unnecessarily escalate the tension, though. For example, if the employee has had conflict with a manager, that manager might not be the best choice to attend the meeting.
Try to be honest about the reasons for termination. Many times employers want to “soften the blow” by saying the separation is about economics rather than performance. That may make the conversation easier in the short term, but can create problems down the road.
First, this does not give the employee valuable information about what went wrong. Second, it will raise doubts and questions if, for example, he or she sees that the position is quickly filled by someone else.
That said, you do not need to pile on. The termination meeting does not have to be a full airing of grievances, just a clear explanation of the main reason for the decision.
Also, to the extent that you can honestly do so, offer appreciation for the value that they brought to the position and organization during their tenure. The less your employee leaves the meeting feeling defensive or like a failure, the better your chances for a smooth transition.
If you have a human resources department, it is a good idea to have an HR representative present for the meeting. If you do not have an HR representative, you may consider having someone else sit in on the meeting, to serve as a witness and possibly to reinforce whatever message you have for the departing employee. You should make sure that having another person present does not unnecessarily escalate the tension, though. For example, if the employee has had conflict with a manager, that manager might not be the best choice to attend the meeting.
Try to be honest about the reasons for termination. Many times employers want to “soften the blow” by saying the separation is about economics rather than performance. That may make the conversation easier in the short term, but can create problems down the road.
First, this does not give the employee valuable information about what went wrong. Second, it will raise doubts and questions if, for example, he or she sees that the position is quickly filled by someone else.
That said, you do not need to pile on. The termination meeting does not have to be a full airing of grievances, just a clear explanation of the main reason for the decision.
Also, to the extent that you can honestly do so, offer appreciation for the value that they brought to the position and organization during their tenure. The less your employee leaves the meeting feeling defensive or like a failure, the better your chances for a smooth transition.
How Our Employment Lawyers Can Help
If you are in the difficult position of firing employees, we can help. We will help you assess whether you have any risk of suit from the employee. We will also help you make a plan for minimizing that risk. You can use the button below to schedule a call back from a member of our team, or give us a call at 781-784-2322.
