Grounds for Termination – What You Need to Know

The decision to fire an employee is rarely an easy one. Above all, you must be sure that you have sufficient grounds for termination. If you don’t have justifiable and legal reasons for firing an employee, the worker can go to court and charge the company with wrongful discharge or discrimination.

With a growing number of such lawsuits swarming the courtrooms across the country, you need to be especially careful when you make that important decision to terminate an employee.

Federal and state laws and court rulings limit what you can and can’t do when it comes to terminating workers. Here’s an overview of key federal employment laws that affect grounds for termination:

  • Title VII of the Civil Rights Act of 1964 prohibits employers from terminating employees based on race, color, religion, sex, or national origin. A 1978 amendment prohibits employers from firing based on medical conditions, including pregnancy.
  • The Fair Labor Standards Act prohibits employers from disciplining or terminating employees for complaining about wage and hour violations.
  • The National Labor Relations Act prohibits employers from engaging in unfair labor practices, such as preventing employees from joining a union, filing complaints with the National Labor Relations Board, or testifying in a Board hearing.
  • The Occupational Safety and Health Act makes it illegal for employers to retaliate against employees for filing complaints about workplace safety or health issues.
  • The Age Discrimination in Employment Act prohibits firing employees aged 40 or older because of their age.
  • The Whistleblowers Protection Act of 1989 protects federal employees from termination for reporting certain unlawful activities. Many other federal and state employment laws also have clauses that prohibit retaliation against whistleblowers, both in the public and private sectors.
  • The Employee Retirement Income Security Act prohibits employers from firing employees to avoid having to pay pension benefits.
  • The Rehabilitation Act and the Americans with Disabilities Act prohibit employers from discriminating against physically or mentally challenged employees who are otherwise qualified for employment.

Remember that you must also take state fair employment laws into account. Sometimes state laws provide more protection for employees

Of course, despite these limitations, there are still many good and legal reasons for firing an employee. Foremost among these is poor performance.

You have the right to fire any employee who does not perform satisfactorily on the job. Even employment contracts require satisfactory performance or the employee can be terminated.

Having said that, however, it’s important to make two critical points:

  • Before you terminate an employee for poor performance, you should have exhausted all other possibilities, including counseling, training, and progressive discipline. Firing without making any effort to help the employee improve would undoubtedly raise a lot of questions about the legitimacy of the termination.
  • The second point is that the best protection against a claim of wrongful discharge or discriminatory firing is well-documented performance records that prove a nondiscriminatory and non-retaliatory reason for terminating the employee.

Think about the employee records you keep and how they could help support a decision to fire an employee.

Other legitimate grounds for dismissal are poor attendance and chronic lateness. You cannot run a business when employees are constantly late or absent, and the laws and the courts recognize this fact. Here are some important points about attendance and termination:

  • Make sure all employees understand the company’s policies and procedures concerning attendance and lateness. Firing an employee who didn’t understand the rules would raise an issue of fairness.
  • Distinguish between excused absences with notice—such as legitimate illness, jury duty, or bereavement leave—and unexcused absences where the employee simply fails to show up for work without notice.
  • Interpret and apply the rules reasonably and fairly. Being occasionally late by 5 minutes would not warrant firing an employee. But if an employee is late every day by 5 minutes, despite repeated warnings, and an important operation cannot commence until the employee arrives, firing may be justifiable.
  • Also, be sure to document all absences and lateness accurately. Keep written accounts of incidents of unexcused absence, failure to notify of absence, and excessive tardiness. And be sure to inform the employee that you are tracking this information.

You have every right to fire an employee who breaks your rules. But there are some important cautions to consider violations of company policy.

  • Make sure employees understand company policies. Review key policies with your workers periodically.
  • Always include a review of policies that affect your department during new employee orientations.
  • Communicate your expectations clearly concerning company policies. Make sure they understand that you expect them to honor the policies you’ve explained.
  • Describe the possible consequences of not following policies.
  • And finally, be sure to document all violations and apply appropriate consequences—whether that is counseling, warning, or disciplining the employee.

Think about circumstances under which you might contemplate firing an employee for violations of company policy.