YOU'RE FIRED! See You in Court.
The last thing a contractor needs is a lawsuit. Yet, today, this may be exactly what you receive when you must discharge a problem employee. How can you stay out of court when you must fire a poor worker? Here are some tips.
STEP 1: Know the Law.
Kentucky, and its neighboring states, are all employment at will states. An employee may be discharged for good reason, bad reason, or no reason at all . . . as long as it is not an illegal reason.
The first step in staying out of court is knowing, in advance, what the illegal reasons for firing an employee are. Some of these illegal reasons are obvious (race, sex, age, disability, etc.). Others are less well known. For example, two or more employees who complain or protest wages, hours, or working conditions are protected by the National Labor Relations Act . . . even if there is no union.
Workers' compensation, OSHA, environmental laws . . . even bankruptcy, garnishment, and prevailing wage laws, also, contain protections for fired workers. In fact, there are more than 40 different legal protections that workers can argue make their discharge illegal. [For a list of these "illegal reasons" for discharge, contact AGC of Ky.'s office and ask for the author's Litigation Risk List.© ] By knowing, in advance of the discharge, whether the fired worker can claim you had an illegal reason for firing him/her, you can be prepared to prove the true, lawful reason for the discharge.
STEP 2: Address Employee Problems Promptly.
Few problems go away . . . if they are ignored. The same is true of "problem" employees. Lazy, complaining, low skilled, or chronically absent employees are unlikely to improve with time. You will have to fire them sometime. You improve your chances of staying out of court if you begin warning them immediately, then discharge them promptly if they fail to improve. Delay a discharge only if time is likely to (1) improve the employee's performance, or (2) improve your legal position.
For example, assume you have a 25-year-old male construction worker with decent skills . . . but a drinking problem. You consider discharging him because he continues to be absent every Monday. He is also unreliable on other days of the week, even though you have warned him that his job is at risk. You threaten to fire him, but decide to give him "one last chance." He then reports that he has injured his back at work.
Before this employee reported a workplace injury, you could have fired him with virtually no legal risk. Now, any discharge will likely result in him suing you, claiming that your "real reason" for firing the employee was his workers' comp claim. After all . . . you "put up" with his absenteeism until he filed for workers' comp!
STEP 3: Plan Defenses In Advance.
Of course, quick action will not avoid every employment law risk. Sometimes an employee must be discharged even though the employee may claim you had an unlawful motive for firing him/her. Under these circumstances, plan your defense before you fire the employee, whenever possible. There are a number of actions you can take to minimize your risk of liability if you take these actions in advance. Some of these are as follows:
Use the same manager to hire and fire: You can create a defense to many employment discrimination claims by using the same manager to make the discharge decision that you used to make the hiring decision. For example, a job superintendent who was not prejudiced at the time he/she hired a female construction worker is unlikely to have been prejudiced when he/she, later, fired the same employee.
For this reason, the Federal Appeals Court, with jurisdiction over Kentucky and several neighboring states, has ruled that a "legal inference" arises that manager did not unlawfully discriminate when he/she fired an employee where the alleged reason for the discrimination existed at the time the same manager hired the employee. Accordingly, you should have the manager who hired the employee make the decision to fire the employee, whenever possible.
Replace fired employee with another employee in the same "protected" category: Obviously, an employer is not guilty of unlawful discrimination if he/she replaces a discharged African-American employee with another African-American employee, etc. In such cases, the law will not permit the fired employee to even take his/her case to a jury. The extra effort required to find a replacement from the same "protected" category will be justified when your case might otherwise be difficult to defend.
Seek input from good employees in the same protected category: A poor employee is a burden not just upon the contractor but on the poor employee's fellow workers. Good employees end up carrying the poor employee's "load." For this reason, consult good employees, preferably in the same protected category, about your problem employee's performance. Juries are usually made up of employees. For this reason, employees often make the best witnesses. If you have a manager in the same protected category as the employee you are firing, who can actually make the discharge decision, your defense becomes even better.
Choose your witnesses, before you are sued, by involving the individuals you want to serve as witnesses in the discharge decision. Be careful, however, not to share disparaging remarks about any employee with co-workers who are not involved in the discharged decision. Otherwise, you create the risk of a slander suit brought by the discharged employee.
Create a record of the reason for discharge: No law requires you to "document" the reason for an employee's discharge. If you do not document an event, however, you may have difficulty proving the event occurred in a court of law. For this reason, the best practice is to record, in detail, at the time, the reason for every instance of employee discipline, up to and including discharge.
Some employers have formal, progressive disciplinary procedures. Such formal procedures are sometimes useful, but they can be harmful if they do not preserve the employer's flexibility to respond to special circumstances with special discipline. If your company has no formal disciplinary procedure, then simply document employee misconduct in a handwritten log or notebook. As long as the record is made at the time of the misconduct and discipline, it will be valuable as evidence. If you have the employee acknowledge receiving a copy of the written record of discipline, its value as evidence will be even greater.
Nevertheless, do not fail to take necessary disciplinary action simply because your past documentation is not perfect. If inadequate documentation, or any other factor, will make proving the real reason for the discharge difficult, legal counsel who is experienced in labor and employment law matters should be consulted to determine whether delaying discipline, including discharge, is more likely to increase your legal risk than reduce it. Often, delay will only make matters worse.
The Million Dollar Mistake. The past 18 months have seen a rash of jury verdicts against Kentucky employers near or greater than $1 million each. Jury verdicts over $1 million in employment law cases are not new to Louisville and Lexington. Now, however, we are seeing Juries award such verdicts even in the smaller communities of Kentucky.
In many other types of litigation, a contractor's risk of loss depends upon the dollar amount of damages done. The amount of a jury verdict in an employment law case, however, depends more on the jury's perception of whether the contractor treated the employee "fairly." An angry jury equals a big verdict.
The most expensive mistakes made by contractors over the next 12 months may not be in the bidding of contracts, but in the firing of employees. For this reason, Kentucky contractors should make every effort to stay out of court!
Attorneys
- 502.568.0263
