How to Fire An Employee – Employee At Will

I have a number of friends who are in business for themselves.  Some of them will call me when they find themselves dealing with a dicey human resources matter.  Without fail, the most common question I am asked is, “ Can I fire him?” Based upon the small fact set I am presented, my pat answer is “Sure”. Then we delve into the facts of the matter.

There is a doctrine in employment which is call the Employment at Will doctrine.  With a few exceptions (Montana does not concur) this is the employment  doctrine which supports the concept that just as employees can leave employers at anytime they choose to do so, employer can sever their employment relations with employees without cause. There are some across the board exceptions to this doctrine, and there are some specific state by state exceptions.  The three broad exemptions are listed below (details here)

• Breach of contract by the employer
• Breach of an implied Covenant of Good Faith and fair dealing
• Violation of public policy by the employer

On a very practical level what do these exemptions mean? In terminating an employee you cannot break the law; i.e. discriminatory actions.   Example:  I am firing you because you are an old minority woman – NOT!  Further you cannot fire an employee for filing a workmen’s compensation claim. Most states and the federal government have protected status for whistle blowers and reporting of criminal activity.  Most of this is covered in the public policy by the employer.

Another  thing worth mentioning is the “implied contract.”   An employee, or more likely a petioner’s labor attorney might take a line like, ‘You will always have a job around here” or “we will never let you go” as an implied contract.  So if you make statements like that to your employees – STOP!

Based upon what I have learned over the years, the question about termination arises when you just have a bad or poor performing employee and you want to move them on down the road. More often than not it is “ok” to do so, especially if your business has less than 10 employees.  Having said that, though, I would still encourage you to do the work and make your notes about their poor performance, attendance or whatever their shortcoming might be. Before you let them go, counsel them, give them a chance to improve. Then if they don’t, it’s time to give them a new opportunity.  And if your state is anything like mine (Illinois) your business will probably be the chargeable employer for the purposes of unemployment.

Employment at will is unique to the USA. Most of the other industrialized nations do not subscribe to this doctrine. Fortunately this won’t concern you if you run a small business here in the states.

So go forth, terminate at will – as needed, document your actions and keep your business’ reputation in mind; you don‘t want to be that brand or store where no one wants to work!

Photo courtesy of Xurble via Flickr Creative Commons