WV Executive

THE INCREASING NUMBER of federal and state laws governing the employeremployee relationship has resulted in the ever-increasing risk of legal liability to employers who are terminating employees. Verdicts in the six fi gure range are now more common than they have ever been. Despite the legal pitfalls and snares that exist when fi ring an employee, there are certain instances where terminations are not only appropriate but necessary in order to preserve the orderly and effi cient operation of the organization. West Virginia, like the majority of states nationwide, is an employment at-will jurisdiction. That means that, generally speaking, employees can be discharged at anytime, with or without notice and for any reason or no reason, as long as it does not violate the law or public policy. This article lays out some of the issues involved in a termination and provides employers with practical advice so that they may anticipate and take steps necessary to reduce the risk associated with discharging an employee.

To Terminate or Not to Terminate

In light of the various state and federal employmentrelated laws that are regulating more and more areas of employment and given the ever-threatening risk of large jury verdicts, employers must approach the termination of an employee in a deliberate and analytical manner. It is important to examine each and every termination decision in terms of the employee's employment history, how it fi ts with the company's policies and the company's past history dealing with the same or similar issues. This review process should identify the possible issues that may be the basis for a future challenge to the termination and permit an employer to be proactive in the defense of the termination decision. Experience teaches that the following factors should be considered when determining whether to terminate an employee:

1. Is it consistent with past practice? Before terminating an employee, it is crucial that past termination decisions are analyzed to make sure that this decision is consistent with all prior determinations. If the termination is not consistent with past practice, then the employer must be prepared to explain why it is now appropriate in this instance.
2. Is the termination consistent with the employee handbook? Consistency is important and cannot be overstated. If you have drafted and distributed a handbook, it should be followed. If the termination is not consistent with the employee handbook, that inconsistency can be an argument used by a disgruntled employee to challenge the discharge. If you have a good employee handbook, it should state clearly and unequivocally that employees are employed atwill and they are not promised employment for any length of time. In addition, the handbook should contain disclaimers that advise employees that they should neither construe nor interpret the handbook as a contract of employment.
3. Is it documented? Make sure that the reason for the termination is well documented. All warnings about inappropriate conduct or performance issues should be in writing, signed by the employee and contained in the employee's personnel file. All individuals who are involved in the events that lead to the termination decision should provide a written statement describing what they witnessed or otherwise providing an account of their involvement in the events. The supervisor must collect these statements, along with any other documentation (i.e. emails, timecards, videos, etc., that may be relevant to the incident) and make sure they are part of a "termination packet" contained in the employee's personnel file. Further, those individuals who attend the termination meeting should make complete notes of everything that occurs. Obviously, these documents are critical when defending a wrongful termination claim because they form the underlying foundation to an employer's defense to any wrongful discharge litigation.
4. Is it consistent with the personnel file? It is important to make sure that before you decide to terminate, you review the personnel file to make sure that the termination is consistent with the employee's personnel file and more specifically with past reviews of the employee's performance. Employers often experience difficulty in litigation where the personnel file contains performance evaluations of an employee that are neither accurate nor realistic. If employee evaluations are conducted by a company, the evaluations must be complete and accurate or they are not only worthless but can be damaging in a wrongful discharge suit. Also, a review of the personnel file can be useful to identify potential problems from the employee's employment history that the decision-maker may not have been aware of or had forgotten.
5. Prior warnings. Generally, an employee should be warned of the consequences of his actions (or inactions) and given an opportunity to correct the problem. Warnings are critical when defending the fairness of the termination. While West Virginia is an at-will employment jurisdiction, fairness is important to a jury even though it may not be required by law.
6. Are there any special issues with this employee? Has this employee recently fi led a workers' compensation claim, made a safety-related complaint to management, been involved in a union-related activity or has the employee recently taken family or medical leave or returned from military service? These types of special situations must be recognized as potential problem areas for employers as they frequently are the basis to challenge the legality of the termination.
7. Is the employee a member of a protected classification? Under state and federal law, certain classifications are protected from unlawful discrimination, like race, age, sex, disability and religion. The key question where a protected classification is in play is whether this employee was being treated the same as everyone else. If not, termination could be a problem.
8. Would suspension be more appropriate? Has there been a rush to terminate when perhaps a suspension would be a more appropriate disciplinary action to correct an employee's behavior? The decision to terminate is difficult and should not be infl uenced by emotions. Sometimes an objective review of the situation may call for a suspension rather than termination. However, suspending an employee does not foreclose the option of termination. Rather, the time provided by the suspension can be very valuable in conducting an investigation. Coworkers often feel more free to discuss prior misconduct of those employees who have been suspended. Thus, a suspension can be important not only to reach a rational decision but also to develop a solid basis for further disciplinary action. In the end, a decision to terminate should be made on the basis of all the facts and not the result of a rush to judgment.
9. Ultimately, is the termination reasonable? As stated earlier, West Virginia is an employment at-will state, and, therefore, employers generally can terminate employment at any time, for any reason, even a bad reason, as long as that reason does not violate the law or public policy. However, it has been demonstrated that jurors expect employers not to arbitrarily terminate employees. Jurors will be more willing to uphold a decision to terminate if an employer is reasonable and has treated the employee fairly, given all of the circumstances. This is the old-fashioned "gut" test. Sometimes, if it does not feel right, then maybe you should reconsider the decision. While fairness is not generally demanded by law, jurors typically do demand it. The reality is that if the jury does not believe that the decision was fair, they will be more likely to agree that an unlawful motive was behind the decision to fi re an employee.

The Termination Meeting

Equally important to assessing the potential risks that are posed by a termination is the manner by which the employee is terminated. Obviously, this is a diffi cult and awkward situation that requires some planning in order to avoid potential problems. Once the decision to terminate has been made and the pre-termination planning has occurred, employers should sit down with the employee in a private location in such a way as to not draw undue attention to the meeting. It is important to minimize, as much as possible, the embarrassment that such a situation may cause. Often employers will conduct terminations early in the morning or at the end of the day when fewer employees are present. The use of security guards escorting a terminated employee off the premises should be used sparingly and only when appropriate. The following is a list of points to be considered in orchestrating and otherwise planning the termination meeting:

• Be Prepared. Prepare a concise but complete explanation for the basis of the discharge. However, be careful not to provide too much detail. Remember that the explanation you give for the termination is something you must live with and be able to defend. If the termination is challenged by the employee, you cannot add to or change your explanation for the discharge. Therefore, the explanation provided to the employee should be broad to cover each reason for termination. Employers who are not consistent in the reason for the discharge are not likely to be successful in defending the discharge.
• Witnesses. The employee's immediate supervisor/manager should be present for the termination meeting. This discourages the employee from attempting to argue his way out of it. Plus, the supervisor can address any issues raised with respect to prior misconduct and discipline. In addition to the employee's supervisor, an unbiased witness should be present. This witness should be a member of management and, ideally, a person who has not been directly involved in any of the prior events leading to the discharge. Remember that a witness is important because if the employee pursues a wrongful discharge action, the employee often "remembers" things allegedly said during the termination meeting that, in fact, did not occur. Therefore, an impartial witness is crucial.
• Do Not Argue. Given that it may be an emotionally charged situation, the employee may try to argue the merits of the decision. However, approach this meeting like any serious business transaction that must be conducted in a professional manner. There is no benefi t to arguing the basis for the decision to terminate because you are never going to convince the employee that you are right. Remember, too, that arguments present the real danger of saying something that may be regretted later. You must stay in control.
• The Wage Payment and Collection Act. Under West Virginia law, an employee who has been terminated is entitled to be paid everything owed, including all fringe benefi ts, within 72 hours of his termination. If this is not done, the law provides for certain legal remedies which can be very expensive for employers. Therefore, it is important at the termination meeting to have the employee's paycheck ready so that there is no question about the timeliness of the employer's payment of all wages and benefi ts.
• Professional. Do not conduct the termination in a combative or embarrassing manner. Understandably, there is sometimes a desire to make an "example" out of the employee. However, an employee who feels that they have been humiliated in the termination process is certainly more likely to seek out an attorney to challenge their discharge. Mistreatment of an employee during termination only creates added problems. Plus, it can constitute a separate legal cause of action independent of a wrongful discharge claim.
• COBRA. Under the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA), employers are required to notify qualifi ed benefi ciaries of their right to continued coverage of health insurance benefi ts and the timeframe in which they have to elect the continued coverage. This is an important legal notice and should be provided at termination or immediately afterward by certifi ed mail return receipt requested.
• Limit Access to Computers and Sensitive Files. Prior to the termination meeting, disconnect all computer access for the employee and limit the employee's ability to retrieve any other information. This is particularly important for employees who have access to sensitive client or product information. It is not unheard of for employees who have been advised of their pending termination to attempt to destroy, download or alter employer documents. Therefore, it is important to make sure this employee does not have any access to sensitive information, whether it is electronically stored or otherwise. Also, save all fi les, including emails, stored on the employee's computer. This information may be critical to an employer's defense in later litigation.
• Post-Termination Memorandum. It is important that everyone who attended the termination meeting prepare a memorandum of their recollection of everything said, particularly by the employee, during the termination meeting. This memo should then go in the personnel file. This document is part of your "termination packet" and is a key exhibit in any litigation defending the termination.

This has been only a brief review of some of the issues that employers must consider in the termination process. Obviously, there is no way employers can prevent former employees from filing a lawsuit. However, employers can be proactive in developing a defense early to reduce the risk of an employee being successful in a wrongful discharge suit. Therefore, it is recommended that employers consider the above issues prior to any termination as well as consult with their labor counsel in order to best navigate through any potential problems that may exist with the termination of employees.