An employer may encounter a fired employee after their termination. Because of this, employers should have a gameplan on how to handle these situations. Some common scenarios where an employer will be asked to communicate with or about a fired employee are:
- Conversations with other employees within the company;
- Reference requests from prospective employers; and/or
- Legal or administrative proceedings.
Most companies have a protocol for terminating an employee, and it’s important to first refer to the company handbook before assuming you know what to do.
While you do not have to inform your other employees when a co-worker is terminated, making a short generic statement would not be a bad practice. This keeps your employees informed and ready to embrace any changes that may follow.
Tell your employees that you wish to respect the privacy of the former employee and that any questions should be directed towards upper management. However, do not go into the specific details about why an employee was fired. Doing so could have negative ramifications if the terminated employee files a lawsuit down the road.
A prospective employer may contact you for a reference for an employee you fired. This can be a tough situation because making negative comments could lead to a defamation lawsuit (even if the comments are true).
You could just simply decline to provide a reference for your previous employee. While you do not have to give a reason for doing so, a neutral comment you can make is that you would not be able to provide a positive reference based on your professional experience with the individual.
If you decide to speak to the prospective employer, here are some ways you could handle the conversation without putting your company at risk for a lawsuit:
- Only Provide the Basics: This generally includes employment dates, job title and salary information.
- Only Disclose Facts that You Can Prove: If you make a comment about a former employee’s work habits or performance, make sure that you have written documentation to support your statements.
- Do not provide personal opinions about the individual and keep it professional. Many states have laws that protect employers from defamation suits as long as they provide references in good faith. Trashing a former employee’s reputation could be viewed as acting in bad faith.
If you have any concerns, then talk to your Human Resources representative before you speak to the prospective employer. They may give you guidelines that are specific to the company, or let you know if it is against company protocol to offer references. This may be the case, depending on the nature of the position or the surrounding circumstances.
An employee who has been fired may decide to take legal action against an employer. This could include the following:
- Unemployment Proceedings: Many states will not allow a terminated employee to collect unemployment if they are fired for misconduct. If that is the case, an unemployment claim will be easy to dispute.
- EEOC or State Administrative Proceedings: If a former employee plans on filing a wrongful termination lawsuit, they generally have to seek administrative relief first with the EEOC or their state’s human rights department.
- An investigation, interviews and a hearing will usually be conducted. Oftentimes, these agencies will not pick up the case and instead issue the individual a right to sue letter.
- Wrongful Termination Lawsuit: An employee may feel that they were discriminated against or terminated for an unfair reason. Some examples are terminating someone because of gender discrimination, retaliation or refusal to commit an illegal act.
- Defamation Lawsuit: These can be filed when former employees discover that an employer is making damaging comments about them.
- The individual only has to show that you intentionally damaged their reputation by making negative statements that you knew were false. Because of this you should be extremely careful when making comments about previous employees, whether it be to other employees or a third party.
Basically, as long as an you keep written documentation of important conversations and events that lead to an employee’s termination, it will be easier to fight any legal proceedings.
When companies fail to document these things, it opens them up for future legal exposure. To avoid this, make sure your company has policies in place directing employees to follow up important conversations in writing.
If you face a legal proceeding after firing an employee, contact an employment lawyer in your area. A lawyer can review your case and determine if you have grounds to file a motion to dismiss.
A lawyer can also help you formulate a defense if the case moves forward to trial. It also would not be a bad idea to have a lawyer review and update your current employment policies.