How Employers Can Avoid a Wrongful Termination Lawsuit
Employment attorneys discuss what wrongful termination means and how to avoid it
By Nancy Henderson | Reviewed by Canaan Suitt, J.D. | Last updated on September 27, 2024 Featuring practical insights from contributing attorneys Renee Inomata and Samia M. KirmaniUse these links to jump to different sections:
- Consequences of Unlawful Termination Claims for Employers
- Avoiding Legal Action by Remedying the Underlying Employment Conflict
- Make Sure You Have a Legitimate Business Reason to Terminate Employees
- Steps to Take as an Employer if You’re Facing a Wrongful Termination Case
- Find an Experienced Wrongful Termination Lawyer
When clients call Renee Inomata for advice, the No. 1 question she hears is: “I need to let somebody go. What are the risks involved?” Inomata, a former litigator who now focuses on helping employers avert mistakes as an employment defense attorney at Casner & Edwards in Boston, adds: “A lot of what I deal with is trying to avoid a wrongful termination claim.”
Consequences of Unlawful Termination Claims for Employers
Simply put, wrongful termination takes place when a worker is fired for an illegal reason— such as violation of a state or federal law, retaliation against whistleblower activity, or discrimination based on a protected class, including race, gender, sexual orientation, pregnancy, national origin, and age—or if the company’s termination policies aren’t followed.
The result can be costly if the former employee files a complaint and wins since the employer may be ordered to pay damages for lost wages, emotional distress, and attorney fees for both sides. Even at-will employees, who can otherwise be dismissed at any time, can’t be fired for unlawful reasons.
In Massachusetts, where Inomata practices, the requirements regarding final pay are especially stringent, with serious consequences for withholding the full amount an employee is owed. “If you really don’t want to pay out a huge commission payment that’s coming due next week, and you fire them this week, then you may still be accused of wrong termination and then subject to having to pay not just those commissions but three times those commissions and the employee’s attorney’s fees,” Inomata says. “Make sure you don’t compound that by not paying them something that they would’ve gotten had you decided on a different timing for the termination.”
Avoiding Legal Action by Remedying the Underlying Employment Conflict
The best way to avoid a conflict, of course, is to remedy the underlying problem before it reaches a boiling point. Start by keeping up with the frequently changing laws—a good employment attorney can help.
Document performance issues and address them early. Ensure your human resources personnel know how to respond to employee complaints properly. “Train your managers on how to communicate clearly and frequently with employees about what the business expectations are and how they’re performing against those expectations,” says Inomata.
Make Sure You Have a Legitimate Business Reason to Terminate Employees
Before you let an employee go, make sure you know the legitimate business reason to do so, says Samia Kirmani, an attorney with Jackson Lewis. “They really need to ask themselves: What’s the reason? And why am I taking this action now? What was the tipping point? Answer the questions ‘why’ and ‘why now?’”
If you haven’t observed the employee’s poor performance yourself, don’t rely on just one co-worker’s opinion. “They might’ve been motivated to be a little less candid,” Inomata says. “Make the investment needed to minimize the potential for unlawful conduct, and take time to listen to the employee and investigate objectively and thoroughly.”
If performance is the issue, study the employee’s performance reports and make sure they line up with your reasons for firing them. “If somebody were to challenge this decision, and I was telling the story, what would I have to show that I’m not making that up?” Kirmani says.
Steps to Take as an Employer if You’re Facing a Wrongful Termination Case
So what do you do if a former worker still brings a wrongful termination claim? “Most of these cases end up becoming lawsuits if the employee gets really upset or angry or feels that the employer is striking back at them,” Inomata says. “It’s best to sort of take a deep breath and say, ‘Thank you for bringing this to my attention. We’ll review it and get back to you.’”
Adds Kirmani, “From my perspective, these kinds of employment-based claims rise and fall based on what the employer did when they learned there was an issue. Sometimes when mistakes happen, it’s because everybody is moving too quickly. Slow down and take the time to say, ‘Hang on a second. What’s going on here?’”
Next, seek legal counsel and contact your insurance company if you have employment practice liability coverage. Above all, play it straight. Save copies of potential evidence, don’t try to cover it up or destroy it, and instruct your managers to do the same.
Never get defensive or downplay an employee’s allegation. “Most people, when an employee raises a criticism, their first reaction is, ‘Oh, that’s not possible,’” says Inomata. “It’s really important for managers and supervisors, when an employee comes to them and says, ‘This person did this,’ to not automatically say, ‘Oh, don’t worry about it’ or ‘You’re ridiculous.’ The reaction that the employee gets is usually what triggers or accelerates more of the hostility and the animosity that leads to a lawsuit.”
Find an Experienced Wrongful Termination Lawyer
Visit the Super Lawyers directory to find an experienced employment lawyer who handles wrongful termination suits for legal advice.
To learn more about at-will employment and employee rights in unlawful termination claims, see our overview of wrongful termination law.
What do I do next?
Enter your location below to get connected with a qualified attorney today.Additional Wrongful Termination articles
- What Is Wrongful Termination Law?
- What It Takes to Prove Wrongful Termination
- Is It Legal to Be Fired Without Notice?
- What Is an Implied Employment Contract in Wrongful Termination?
- Was I Fired for Discriminatory Reasons?
- What Are My Legal Rights When Fired from a Job?
- Understanding the Role of Retaliation in Wrongful Termination Cases
- How Do I Know if I Have a Wrongful Termination Claim?
- Should You Hire a Wrongful Termination Lawyer?
- What Qualifies as Wrongful Termination?
- When to Report Wrongful Termination
- What To Do if Your Employer Wrongfully Terminated You
- Can I Get Unemployment if I Was Wrongfully Terminated?
- Can I Bring a Wrongful Termination Claim if I'm in a Union?
- Can I Be Fired for Whistleblowing?
- Wrongful Termination for Exercising My Legal Rights
- What Are Protected Activities Under Wrongful Termination Law?
- Can I Be Fired for Refusing to Sign a Non-Compete Agreement?
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