After companies merge, there are often too many employees for the remaining available positions. That’s especially true when the new entity also reorganizes operations. Some employees will wind up on the chopping block.
Be careful how you choose termination candidates. The best approach is to treat the decision like a hiring or promotion. Have the employees apply for the remaining positions. Evaluate their skills, experience, performance and other relevant factors as you would for a new hire or promotion.
That gives you solid evidence in case the terminated employee sues.
Recent case: Barbara Gambill, who is over age 40, worked as an environmental attorney for Cinergy. When the company merged with Duke Energy in 2005, the new company streamlined operations and consolidated its legal department. It first asked for volunteers among the legal staff; they would receive a cash bonus if they resigned. Some did, but Gambill declined.
The company then decided to create a new position within the consolidated legal department. Both Gambill and a younger attorney sought the job.
After interviews, evaluation reviews, input from the internal clients each served and supervisor assessments of theirqualities, the final score sheet showed Gambill losing out to her younger competitor. For example, the younger attorney had managed a very complex legal case involving the Clean Air Act, earning praise from internal clients. But Gambill’s clients often complained about the way she handled cases.
Duke Energy terminated Gambill, and she sued, claiming age discrimination.
But she couldn’t show that the company’s stated business reason—namely that the other candidate was as qualified or better qualified—was a pretext to cover up terminating an older worker. The case was dismissed. (Gambill, et al., v. Duke Energy, No. 10-3333, 6th Cir., 2012)