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Vol. 29, No. 3

Got a problem employee? Read this before you fire

by Marilyn Cavicchia

One might expect that labor and employment lawyer Bob Stevens, speaking to NABE members at the group’s August Annual Meeting in Atlanta, would discuss how to fire an employee without getting sued.

While that was a major focus, Stevens, of the Atlanta office of Troutman Sanders, encouraged his audience to make a real effort to rehabilitate problem employees and to communicate in a way that heads off problems before they even start. Why this softer approach?

Money is one big reason; employees are probably your biggest single line item expense—much more expensive than any physical "stuff," Stevens said. "It’s very important that you not waste money in dealing with [employees]," he stressed. "And turnover wastes a lot of money."

Another reason is that, as many executive directors and managers know, avoiding a lawsuit is much easier if the employer has made efforts to help the employee improve his or her performance—and has documented those efforts. Stevens wishes more of his clients would remember this critical step. Some clients, when asked if they’ve let the employee know there’s a problem, say, " ‘We told him yesterday.’ "

Is it legal to wait until you’re close to firing someone, and then to warn him or her verbally rather than in writing? It very well may be, Stevens said, but such behavior doesn’t pass the "smell test," meaning the employee may try to sue. Even if the employee loses the resulting lawsuit, Stevens noted, it could cost the employer $50,000 to fight it.

But aside from money, Stevens stressed that trying to rehabilitate an employee just makes good sense. "You want to manage the problem employee so they become a productive asset," he said.

Clear, consistent rules

"Make sure your employees know what the rules of the game are," Stevens said, and make sure those rules are consistent for all employees. Not only can problems arise when expectations aren’t clearly spelled out, they can also occur when different managers apply the rules differently. If your rule is that work begins at 8 and a manager allows one employee to come in at 8:10, other employees in that department or other departments will notice—which will bring down morale, and may prompt the other employees to come in late, too.

It isn’t that employers should necessarily be inflexible, Stevens said; the problem with the example above is that the time flexibility goes against the company’s stated rules. "If you’re not going to follow a rule, you shouldn’t have it," he said.

It is OK to have different rules for exempt and nonexempt employees, Stevens noted, as long as the rules are clear and are consistently applied within those designations.

Clarity can help head off job performance problems, or, failing that, it can help prevent a lawsuit. If employees know the rules and continue to break them, Stevens said, "they’re usually not surprised" by being fired—and employees who are not surprised are also less likely to sue.

A tough conversation

Many managers and chief staff executives dread telling employees their performance is lacking or that they are breaking a rule. "Nobody likes to deliver bad news, particularly to someone you work very closely with," Stevens noted. How do you broach the subject?

The first step, he said, is to "check your emotions" and avoid belittling the employee or using vulgar language: "One of the things we’re doing in managing employees is we’re managing emotions." Instead of yelling or being vague, the manager or CSE should calmly and concretely express what the problem is and how it should be remedied. If you put off having such a discussion, Stevens said, the employee will likely get the message that there are no problems with his or her work. "If you don’t explain to people where they’re lacking, they won’t improve," he said.

A written warning is a great way to leave a paper trail in case the situation doesn’t improve, Stevens said, but if your rehabilitation effort is simply an oral counseling, you should still keep a written record that it occurred. This documentation may not hold up as well as a written warning, he said, but is certainly better than no documentation at all.

Use your evaluation

Stevens said many employers and managers fail to make the best use of a great rehabilitation and remediation tool: the annual performance evaluation. It can be hard to persuade managers to do an evaluation in earnest, he said, because it seems like just one more task, and one that is not terribly productive.

"I have seen way too many performance evaluations where there’s an opportunity to give a one through a five, and all the employees get fours and fives," Stevens noted.

But the evaluation is a great opportunity to stress again what is expected—and to put in writing any improvements needed and any consequences if improvements aren’t made, he said. If problems continue, he added, past evaluations are a great way to track progress, or lack thereof—and a great source of documentation in case of a lawsuit.

It isn’t strictly necessary to have the employee sign the evaluation, Stevens said, but it can be a big help if a lawsuit arises. If the employee refuses, the manager should write "refused to sign," Stevens advised.

He also recommended that employees be able to object to their evaluation, and that the objection be placed in their file. This measure is not likely to be damaging in a lawsuit, and the experience can be cathartic for the employee, Stevens said. Because he or she feels the objection has been noted, the employee may be more willing to absorb the evaluation and then get back to work, rather than sulking or harboring a grudge, he explained.

If worse comes to worst

But what if these efforts fail, and you do have to fire someone? The first step, Stevens said, is to gather the facts, which includes looking through any documentation and talking to managers. This includes managers other than the employee’s own—they may also have observed negative behavior, Stevens explained.

When gathering information, it’s important to collect facts, not hyperbole, and to include those facts in the justification for the firing, Stevens said. If, for example, you tell someone he or she is being fired for being "late all the time," the employee could later tell a judge, "I was there for a year and I was late three days." As with job expectations, the more clear and specific you can be, the better, Stevens said.

Stevens recommended doing the firing at the end of the workday, which can be less embarrassing and also less disruptive to the other employees. Two people should be involved, he said: the manager making the decision, and either a human resources manager or another manager. Whether from HR or another department, the second person should take notes, Stevens explained.

Keep it brief, Stevens advised: Resist rambling, and instead, simply explain why the decision has been made and then go with the employee to retrieve any company property. This step will preclude having to ask an employment lawyer, " ‘How do I get back my laptop? He won’t mail it back to me,’ " Stevens said. Retrieving property once the employee leaves can be tricky, Stevens noted: In most states, an employer can’t hold the last check, meaning the only way to get the property back might be to sue.

It’s hard not to worry about the employee’s feelings, Stevens said, but here, too, all those prior rehabilitation attempts can help. If you have met with the employee time and again, to no avail, there’s a good chance he or she knows this day is coming, and the response might surprise you. "Many times," Stevens said, "the employee is relieved."