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Wrongful Termination

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Avoid Wrongful Termination Issues: Treat Employees Fairly; Offer Severance

Avoid Wrongful Termination Issues by Treating Employees Fairly and Offering a Severance Package Upon Employment Termination

Pali Rao
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An employee experiences wrongful termination if their employment is ended for reasons that are discriminatory and unlawful. Wrongful termination also occurs when an employer fails to follow their written procedures for employment termination.

From an employer's perspective, avoid wrongful termination concerns by demonstrating that you treat all employees fairly and with dignity and respect, even in an employment termination situation.

Maintain a consistent approach to employee performance improvement that allows you to use progressive disciplinary action as necessary. But, make certain that your employee handbook documentation about performance counseling and employment termination allows you to change course depending on the specific circumstances of the employee situation.

Do not lock yourself into language that requires a specific course of action that may not fit the current performance situation.

Narrow Circumstances for Wrongful Termination Claims

Circumstances that might warrant a wrongful termination claim include:

  • Breach of contract: the employer has a legal obligation to uphold all components of an employment contract, union-negotiated or otherwise. Most employment contracts have employment termination clauses which the employer must honor.

  • Breach of implied contract: the employer must take care that the company does not imply in writing or verbally that employment is protected or guaranteed or that any other non-contractual obligations exist. This is why most employers ask employees to sign off on an employee handbook statement that states that written company documents offer guidelines, not a contract.

  • Breach of covenant of good faith and fair dealings: the terminated employee can try to prove that their termination was unfair and that an employer did not fire him for good cause, in some states. This is extremely difficult to prove if an employer has kept even a modicum of documentation about an employee's performance problems and managerial counseling. Terminated employees will generally find that employment at will is the more significant decision factor.


  • Unlawful discrimination: employment discrimination is illegal. Former employees must file suit with the Equal Employment Opportunity Commission (EEOC), and perhaps their state civil rights commission, before charging an employer in court. An employer protects their organization from such charges by practicing strict care to avoid employment discrimination, or the appearance of employment discrimination, for any reason.


  • Other potential claims of wrongful termination can arise from whistle blowing situations in which an employee reports illegal happenings such as tax evasion, employee use of a benefit such as filing a worker's compensation claim, or an employee's refusal to perform an illegal action.

Find out more about wrongful termination.

Disclaimer: Please note that Susan makes every effort to offer accurate, common-sense, ethical Human Resources management, employer, and workplace advice on this website, but she is not an attorney, and the content on the site is not to be construed as legal advice. The site has a world-wide audience and employment laws and regulations vary from state to state and country to country, so the site cannot be definitive on all of them for your workplace. When in doubt, always seek legal counsel. The information on the site is provided for guidance only, never as legal advice.

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Also Known As: wrongful dismissal, unjust termination, unfair termination
Examples:
Employers protect themselves from charges of wrongful termination by fairly and consistently treating all employees who are exhibiting performance problems prior to employment termination.
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