Best Practices For Terminating An Employee Lawyers

Bonisiwe Shabane

-Oct 29, 2025, 5:19 PM

best practices for terminating an employee lawyers

An experienced team of legal writers and editors researches, drafts, edits, and updates the articles in the Understand Your Issue section of Lawyers.com. Each contributor has either a law degree or independently established legal credentials. Learn more about us. No one likes the idea of firing an employee. Unfortunately, it's unavoidable for most business owners and managers. Terminating an employee is an inherently difficult situation that exposes the company to legal liability if not handled property.

Following best practices throughout the termination process will help you avoid legal trouble and make the process less stressful for all involved. Before meeting with the employee, make sure you understand the nature of the employment relationship. Is there an employment contract that says that employees can be fired only for a good reason? Or is this at-will employment that can be ended at any time without cause? If there’s an employment contract, it will usually spell out the reasons an employee can be fired, such as tardiness, unexcused absences, or misconduct. Employers should be careful not to make statements that could create implied employment contracts with employees.

For example, a boss who tells a top employee, “We’ll always have a place for you here,” might be inadvertently creating an oral contract of employment. Here are some best practices for handling employee terminations: Before terminating an employee, it is crucial to have a paper trail that outlines the reasons for the termination. Document any performance issues, disciplinary actions, or warnings given to the employee. This documentation will serve as evidence if the termination is ever challenged legally. Having proper documentation is essential in any termination process.

It helps ensure that the decision is fair and justifiable, reducing the risk of potential legal disputes. Whether it’s poor performance, violation of company policies, or misconduct, be sure to thoroughly document each issue and the actions taken to address them. Include specific dates, times, and details of incidents or discussions with the employee. This will provide a clear timeline of events and support your decision to terminate if needed. Remember to maintain confidentiality when documenting sensitive information, keeping it secure and accessible only to authorized personnel. Adhering to company policies and applicable employment laws is crucial when terminating an employee.

Familiarize yourself with the local labor and employment laws and regulations to ensure that the termination process is carried out in compliance with legal requirements. Review your company’s policies and procedures regarding terminations to ensure consistency and fairness in handling employment terminations. Be mindful of any contractual obligations, such as notice periods or severance packages, and ensure they are properly followed. In a perfect world, employees perform optimally, enjoy high job satisfaction, and stay with one company until retirement. This type of perfection rarely exists. According to the U.S.

Bureau of Labor Statistics, the median employee tenure with a single company is 3.9 years. While some staff members resign voluntarily, others are involuntarily terminated. Improper or illegal terminations expose companies to consequential legal issues and financial risk. Employers must attempt to close all possible doors to post-termination litigation to avoid lengthy and expensive legal battles, adverse publicity, and any detrimental impact on employee morale. Make sure your employees understand their job responsibilities, the company’s policies and code of conduct, any performance issues, and ways to improve their performance. That said, the most important way to avoid litigation is by adhering to all applicable federal, state, and local laws concerning employment.

Never fire an employee for an improper or illegal reason. Doing so leads to accusations of discrimination, retaliation, or breach of contract. Emotions run high following an involuntary discharge and some ex-employees are just looking for a fight. While nothing can totally bar former workers from pursuing legal action, employers can take steps to take the wind out of these individuals’ litigious sails. Get a free trial of Practical Law, the how-to resource with termination best practices, protocols and practical tips for employers on legal risks. The best way to escape a lawsuit it to avoid its inception.

Implementing and following proper termination practices minimizes the risk of encountering a wrongful termination claim. Before initiating a dismissal process, employers must understand all applicable federal and state employee termination laws and policy requirements. To protect confidentiality, only include critical individuals in discussions. Retaining top talent continues to be one of the greatest challenges facing employers today. Even in an employer’s market, the loss of a key employee can disrupt operations and result in significant costs. While compensation plays a role, long-term retention often depends on workplace culture, communication, and employee engagement.

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What Is Corporate Consolidation? Corporate consolidation closely resembles a basic merger transaction. The primary difference is that a consolidation creates an entirely new business […] A termination is simply the ending of an employment relationship and is more commonly referred to as “firing” or “laying off”. This article focuses on the technical procedures associated with termination, rather than the obligations related to severance. (To learn more about wrongful dismissal and reasonable notice, please refer to an earlier article here.)

No one enjoys terminating an employee, especially when there are no concerns or serious allegations. Often an employee will have no idea that termination is coming and maybe upset or in shock. It is best to meet with the employee in person. The meeting should be held privately, which might mean off-site, in a separate office or in a boardroom. It is generally advisable to have two managerial-level employees present. While there is no one best time to undertake a termination, if it is done at the end of the workday, the employee can clear out his or her belongings without having to worry...

You may also want to consider allowing the employee to return after hours to complete this task or – depending on the situation and company policy – it may be more suitable to have... If an employee needs to return company property, you should also consider giving him or her the option of doing so outside of operating hours. It is important to ensure the employee is treated with dignity and respect or it could result in additional damages awarded if the termination ends up in court. For more information about potential damages see our blog post linked to here. Running a business is difficult — and having to terminate an employee may be one of the hardest things you’ll ever have to do as part of its operations. Employee termination can significantly impact employee morale and company culture.

If a termination is not handled correctly, it can also put a business at risk of serious legal repercussions and reputational harm. Not only is firing someone an emotionally difficult task, but there are many statutory and regulatory obligations that must be considered to avoid the potential for litigation. Here are several tips for employers to keep in mind when it comes to employee termination to help ensure the process runs smoothly: There are a broad range of state and federal employment laws that impact the termination process. It’s essential for employers to have an understanding of both employer and employee rights — as well as ensure they are adhering to all applicable regulations regarding employee termination. Remaining compliant is key to avoiding legal consequences.

Notably, upon termination, an employer in California only has 72 hours from the end of an employee’s last shift to provide them with their final paycheck. Failure to do so can result in the company having to pay the equivalent of one day’s earnings for each day the final wages are late. The likelihood that you will have to fire an employee on the spot is usually low, unless there are egregious circumstances. While there may be violations and issues that warrant immediate action, be sure that the decision to terminate is based on fact, not emotion. Basing your decision to terminate an employee on established facts — rather than emotion or opinion — is key to minimizing the risk of a wrongful termination claim.

Best Practices For Terminating An Employee Lawyers

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