Over the last two weeks, over 12 million Americans have filed claims for unemployment benefits according to the U.S. Department of Labor. These historic numbers reflect that thousands of business owners, executives, and managers are faced with difficult decisions to close down their operations, or lay off their employees. Businesses should be careful to give thoughtful consideration to the decision-making process, and ensure the economic hardship and time sensitivity of these issues do not result in decisions that can be easily challenged in wrongful termination lawsuits. Over the next twelve months, we anticipate a significant spike in wrongful termination lawsuits. These lawsuits will allege that particular employees were laid off because of their age, disability, gender, race, national origin, or other protected class. Here are three steps for minimizing your risk of a future wrongful termination claim.
- Check for agreements and policies – Many businesses require employees sign to contracts or acknowledge receipt of handbooks that detail policies regarding their employment, including termination. Some businesses do not carefully consult these documents before decisions are made. Be sure to check to see if these documents require a particular procedure, such as a certain number of days’ notice to the employee before the termination becomes effective.
- Document the decision – While COVID-19 and the resulting economic downturn require swift action, it is critical to document the decision to furlough or terminate a specific employee. Why was this employee chosen over others? What factors were considered in making the decision? Who made the decision? If this is not clearly documented, it creates ambiguity that an employee could take advantage of in a lawsuit claiming discrimination or unlawful termination. Businesses should also use this opportunity to ensure that any performance or disciplinary problems are in writing, so that the basis of any future employment decisions are clearly documented.
- Treat Similar Employees Exactly the Same – Employees in the same position with the same performance and disciplinary history should be treated the same. If similar employees are treated differently (or for reasons that are not well documented such as past attitude problems), employees could challenge the decision and allege they were selected for termination because of their protected class.
In short, business owners and decision-makers should be careful that hard decisions based on COVID-19 and the economic downturn do not unintentionally create legal claims down the road. Following the above best practices, and consulting with an employment attorney, will minimize the risks of these claims.
If you have any questions, please contact Roger Feicht, or another member of Gunster’s Labor and Employment Practice Group.
Additional Resources:
Florida Commission on Human Relations (FCHR) list of state anti-discrimination laws
If you have any questions, please contact Roger Feicht, or another member of Gunster’s Labor and Employment Practice Group.
