One of the most legally dangerous things you can do after you terminate an employee is change the reason for ending the employment relationship.
Instead, decide on a defensible rationale—a performance problem or rule violation, for example, or perhaps a business downturn—at the time of the termination. Document that decision and all the supporting evidence. Then remind execs and supervisors to stay on script.
Rookie managers often make this mistake by trying to over-justify a termination with extraneous reasons. (Examples: “And your attendance wasn’t that good either” or “We haven’t been happy with your work for a while.”)
A court may see your shifting explanations as evidence you are trying to cover up the real reason: discrimination. And that can lead to punitive damages and a large attorneys’ fee award. That’s what happened in the following case.
Recent case: Terri Wallace, a manager at a rental car company, was fired shortly after reporting sexual harassment.
At first, the company said it terminated her because the location was overstaffed, and she had the least seniority. Later, the company said it had also terminated Wallace because of .
She sued. A jury concluded she’d truly been fired for reporting harassment. It awarded her $10,000 in lost wages and benefits, $20,000 for other pain and suffering, and a whopping $500,000 in punitive damages, plus $220,000 in attorneys’ fees. (Wallace v. DTG Operations, No. 08-1474, 8th Cir., 2009)
Bottom line: Pick a solid discharge reason and stick with it. Train managers to stay on message.
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