Volume 19, Number 1
The Fine Art of Hiring and Firing
By Karen Bush Schneider
Raise your hands out there. How many of you went to law school with the goal of actually practicing law? You graduated and opened your practice, confident you’d spend your days helping people through the quagmire of real estate transactions, domestic relations trauma, or unjust criminal accusations. Soon, however, you discovered that your law practice is much more than the practice of law. It is, fundamentally, a business—a business that requires you to be a techno whiz, a numbers cruncher, a janitor, a psychologist, and, last but not least, a human resources director.
Personnel issues arise whether your staff numbers five or 5,000. Consequently, employment-related litigation can involve a small-business owner, like a solo practitioner or small law firm, as easily as it can involve a large corporation. Because the best defense to such litigation is a good offense, you’ll want to make sound hiring decisions and thoughtful firing decisions. If you hire the right people to work with you in your practice, you may never have to face the anguish of a discharge decision.
Federal laws prohibit discrimination in hiring on the basis of a number of characteristics including, but not limited to, race, sex, age, national origin, religion, color, and disability. State and local laws provide additional prohibitions against employment discrimination on the basis of disability, height, weight, marital status, and sexual preference. In making hiring decisions, your firm must avoid reference to, and consideration of, these factors when filling vacant positions.
Sex. All applicants should be asked the same questions regarding their qualifications and availability. For example, do not ask female applicants whether they will be available to work outside normal office hours. Similarly, avoid inquiries regarding a female applicant’s child care arrangements or plans to have children. An employer cannot refuse to hire an applicant because she is pregnant. Also avoid gender-specific questions like "As a woman, how would you handle this situation?"
Race. Job postings, employment applications, and interviews should not reference race or color as a qualification (or disqualification) for employment. Do not ask for information that might disclose an applicant’s race, such as membership in specific organizations.
Religion. Inquiries about an applicant’s religious denomination, affiliation, or holidays observed are illegal. Instead of probing the applicant’s religious practices, describe the required work schedule and ask whether the applicant would be able to adhere to that schedule.
National origin. As a general rule, an employer may not discriminate against noncitizens for employment. Interviewers should avoid questions about national origin, place of birth, lineage, ancestry, or nationality, including the nationality of the applicant’s parents or spouse. After a job offer is made, the employer can document an employee’s legal right to work in this country by requesting that he or she complete an I-9 Form.
Age. Avoid all pre-employment inquiries that might indicate an applicant’s age. Employers cannot ask about, or consider, an applicant’s age or date of birth, nor attempt to ascertain that information by asking about graduation dates or by advertising for "recent grads only." Inquiries about stamina and/or health status of applicants are also suspect. An interviewer can ask whether an applicant is 18 years of age or older, to determine whether the applicant is legally employable.
Marital status. In many states, discrimination based on marital status is also prohibited. Avoid asking whether an applicant is a Mr., Ms., Mrs., or Miss. Do not ask whether an applicant is single, married, or divorced. Inquiries about the existence of minor children are not advisable.
Disability. Employers cannot discriminate against applicants on the basis of disabilities that are unrelated to the performance of the essential duties of the job. Avoid general questions such as "Have you ever suffered from any of the following?" or "What medications do you take?" Applicants, however, can voluntarily disclose information about a disability. An employer can inquire about an applicant’s accommodation needs when an obvious disability would likely interfere with the performance of the job’s essential functions. The EEOC, state civil rights agencies, and the courts have historically condemned inquiries regarding worker’s compensation history and lawful drug use.
Height or weight. Some state laws protect job applicants from employment discrimination on the basis of height or weight. Avoid questions or comments that focus on height or weight characteristics, such as "We need an attractive receptionist at our firm," or "I’m not sure you could reach the top file drawer."
Other criteria expressly limited by law. Employers also are prohibited from discriminating against job applicants based upon military status, arrest records, and refusals to take polygraph examinations.
Conducting Lawful Pre-employment Inquiries
What can an employer do to maximize its chances of making successful, nondiscriminatory hiring decisions? Carefully review each applicant’s resume or job application, looking for "gaps" in work history. Gaps may reveal jobs an applicant omitted because of serious discipline issues or involuntary separation. Ask applicants to explain employment gaps. Also ask them whether they have omitted any employment from their resume and, if so, why.
During the interview, ask probing questions that will reveal qualities the firm is looking for in an associate or legal assistant. Some examples of allowable inquiries are:
• What did you like most/least about your last job?
• Why did you leave your last job?
• Had you been a shareholder or supervisor for your former law firm,what changes would you have made in personnel policies or practices?
• What will your current (or former) employer tell us about you? Will you sign a release so we can get a copy of your personnel record?
• What are your long-range and short-range goals? How are you achieving them?
• What do you see yourself doing five years from now? Ten years from now?
• Why should we hire you?
• What qualifications will help you in this position?
• How can you make a contribution to our firm?
• Describe two or three accomplishments that have given you the most satisfaction.
• Describe your most rewarding law school experience.
• Why do you want this job?
• What is important to you in a job?
• Have you ever been disciplined or counseled in any job? Why? Did you think the discipline was fair?
Avoiding Binding Employment Contracts
Most employees have at-will status, which means their employment can be terminated at any time, with or without cause, as long as the termination is not for an unlawful reason. In some states, the employment at-will doctrine has been modified to require a contractual relationship between employee/employer that can be terminated only for just cause or a similar standard. In other states, a covenant of good faith and fair dealing applies to the employment relationship.
Most employers prefer to have maximum flexibility with employees and retain the right to terminate the employment relationship at any time, without having to prove cause. For high-level positions, the offer of a contractual agreement may be an important recruiting tool. For low-level positions, employers usually prefer an at-will relationship.
If your firm desires to maintain at-will employment, and assuming that your state law permits such a relationship, be sure to review all job postings and advertisements to eliminate representations that refer to the "permanent" nature of the vacant position. Likewise, employment applications should not refer to "cause for dismissal." They should clearly state that completing the application does not constitute an offer of employment and that, if employment is offered, it can be terminated at any time, with or without cause.
All personnel policies and employee handbooks maintained by the law firm should expressly acknowledge that employment is at will and can be terminated by the employee or the firm at any time, with or without cause. Pre-hire interviews should clarify that, if an offer of employment is made, employment will be at will. Letters of engagement should likewise contain such a statement.
Law firms wishing to maintain at-will employment status should avoid establishing probationary periods, training periods of a guaranteed length, or orientation periods that imply that "something more" exists after the completion of that period. These have given rise to contractual relationships in a number of cases.
Discipline and Discharge
Employers always should have sound reasons for taking adverse employment actions. At a minimum, your firm may have to defend an unemployment claim after it discharges an employee. At worst, it may face a wrongful discharge suit. Being an at-will employer will not excuse it from claims of discrimination, whistleblowing, or other statutory violations.
Although not mandatory in an at-will employment relationship, progressive discipline is a helpful tool to demonstrate that you acted reasonably (and legally) in deciding to discipline or discharge. Progressive discipline utilizes an escalating scale of penalties designed to shape employee behavior and avoid the necessity of discharge. Steps include counseling, verbal warnings, written warnings, suspensions with or without pay, and discharge. Whether to apply progressive discipline, and to what degree, must be considered on a case-by-case basis, taking into account the severity of an employee’s misconduct and his or her employment history.
When considering whether to discharge an employee, an employer should consider the following questions. A "no" answer to even one indicates a need to reevaluate whether the discharge is premature.
• Have you investigated, recorded accurately, and documented all the facts?
• Do you have the necessary paper trail, including examples of poor work performance, evaluations, warnings, and disciplinary measures?
• Have you reviewed your policies and practices to determine that (a) clear standards of behavior and work rules exist, and (b) the employee has been treated fairly relative to the procedural aspects of the discharge?
• Has the employee been given a fair and full opportunity to understand the job requirements and performance standards?
• Has the employee been advised of short-comings in performance and behavior?
• Has the employee received a warning of possible dismissal?
• Was the employee given sufficient time and opportunity to correct performance or behavior problems?
• Is the decision to discharge based on facts, not inference, suspicion, or emotion? Do you have evidence of the employee’s guilt (e.g., signed witness statements, documentary or physical evidence, personnel records, etc.)?
• Has the employee been given an opportunity to explain his or her point of view, and have you considered it along with any special or personal difficulties or other mitigating circumstances?
• Have you considered whether a lesser form of discipline, instead of discharge, is appropriate?
• Will this employee’s discharge be consistent with your past practices? Has your firm discharged other employees in the past for the same offense?
• Will you be able to justify this employee’s treatment if discrimination or unjust dismissal is claimed?
• Have you discussed the discharge with those who have a "need to know," as well as those who are involved with the employee, such as your labor counsel, the employee’s supervisor, other shareholders, etc.?
Notwithstanding all of the legal niceties involved in wrongful discharge or employment discrimination cases, if a claim is ever tried, a jury will ask itself one question: Was the employee treated fairly? Ask yourself that question before discharging an employee: Was the decision to discharge fair? Will it be perceived as fair?
Alternatives to discharge. Discharge is painful, not only for the employee but also for the employer. To avoid the discomfort of a discharge, your firm may wish to consider other methods to separate an employee. Consider asking for a resignation or retirement in lieu of imposing an involuntary dismissal. Resignation allows an employee to maintain dignity and positions him or her to more easily obtain another job.
Your firm also may characterize a separation as a "layoff," particularly if the employee will not be replaced. If your firm does intend to replace the employee, however, and the separation is challenged, characterizing a separation as a layoff could be viewed as nothing more than a pretext to escape wrongful discharge litigation. If you choose the layoff option, be prepared to pay unemployment benefits.
Adopting an alternative to outright discharge typically involves a separation agreement and payment of a severance benefit. Common terms in such agreements include payment of consideration for the employee’s release of the firm, a nondisparagement clause, and nondisclosure and nonadmission agreements.
Handling difficult personnel matters with deliberation and sensitivity will go a long way to avoiding legal challenges. If you have any doubts at any point in the process, you would be wise to employ the advice you so frequently give to clients: Seek legal advice from counsel!
Karen Bush Schneider is president and shareholder of White, Schneider, Baird, Young & Chiodini, P.C., in Okemos, Michigan. She specializes in all areas of employment law and is an adjunct professor at Thomas M. Cooley Law School.